p*. 


<^ 


^> 


IMAGE  EVALUATION 
TEST  TARGET  (MT-3) 


1.0     "i.^  I 


2.5 


1^   1^ 


I.I 


us 

US 


140 


2.2 


2.0 


1.8 


m  iiJ4 116 


Hiotographic 

Sciences 

Corporation 


'^ 


\ 


5v 


\\ 


^ 


23  WEST  MAIN  STREET 

WEBSTER,  N.Y.  14580 

(716)  872-4503 


CIHM/ICMH 

Microfiche 

Series. 


CIHM/ICIVIH 
Collection  de 
microfiches. 


Canadian  Institute  for  Historical  Microreproductions  /  Institut  Canadian  de  microreproductions  historiques 


^ 


riaMMBlHiiliHMIMHMHHiaMWK.'MI 


Technical  and  Bibliographic  Notes/Notes  techniques  et  bibliographiques 


The  Institute  has  attempted  to  obtain  the  best 
original  copy  available  for  filming.  Features  of  this 
copy  which  may  be  bibliographically  unique, 
which  may  alter  any  of  the  images  in  the 
reproduction,  or  which  may  significantly  change 
the  usual  method  of  filming,  are  checked  below. 


D 


Coloured  covers/ 
Couverture  de  couleur 


I      I    Covers  damaged/ 


Couverture  endommag6e 


I — I   Covers  restored  and/or  laminated/ 


n 


Couverture  restaurde  et/ou  pelliculde 

Cover  title  missing/ 

Le  titre  de  couverture  manque 


I      I    Coloured  maps/ 


Cartes  g^ographiques  en  couleur 

Coloured  init  (i.e.  other  than  blue  or  black)/ 
Encre  de  couleur  (i.e.  autre  que  bleue  ou  noire) 

Coloured  plates  and/or  illustrations/ 
Planches  et/ou  illustrations  en  couleur 


D 
D 


D 


D 


Bound  with  other  material/ 
Reli6  avec  d'autres  documents 

Tight  binding  may  cause  shadows  or  distortion 
along  interior  margin/ 

La  reliure  serr6e  peut  causer  de  I'ombre  ou  de  la 
distortion  le  long  de  la  marge  intdrieure 

Blank  leaves  added  during  restoration  may 
appear  within  the  text.  Whenever  possible,  these 
have  been  omitted  from  filming/ 
II  se  peut  que  certaines  pages  blanches  ajout^es 
lors  d'une  restauration  apparaissent  dans  le  texte, 
mais,  lorsque  cela  6tait  possible,  ces  pages  n'ont 
pas  6t6  filmdes. 

Additional  comments:/ 
Commentaires  suppl^mentaires; 


L'Institut  a  microfilm^  le  meilleur  exenfipiaire 
qu'il  lui  a  6t6  possible  de  se  procurer.  Les  details 
de  cet  exemplaire  qui  sont  peut-dtre  uniques  du 
point  de  vue  bibliographique,  qui  peuvent  modifier 
une  image  reproduite,  ou  qui  peuvent  exiger  une 
modification  dans  la  m6thode  normale  de  filmage 
sont  indiquds  ci-dessous. 

□    Coloured  pages/ 
Pages  de  couleur 


D 
D 
D 
D 
D 


Pages  damaged/ 
Pages  endommagdes 

Pages  restored  and/or  laminated/ 
Pages  restaurdes  et/ou  pellicul6es 

Pages  discoloured,  stained  or  foxed/ 
Pages  d6color6es,  tachetdes  ou  piqu6es 

Pages  detached/ 
Pages  ddtachdes 

Showthrough/ 
Transparence 


I      I    Quality  of  print  varies/ 


D 


Quality  indgale  de  I'impression 

Includes  supplementary  material/ 
Comprend  du  materiel  suppl^mentaire 

Only  edition  available/ 
Seule  Edition  disponible 


Pages  wholly  or  partially  obscured  by  errata 
slips,  tissues,  etc.,  have  been  refilmed  to 
ensure  the  best  possible  image/ 
Les  pages  totalement  ou  partiellement 
obscurcies  par  un  feuillet  d'errata,  une  pelure, 
etc.,  ont  6t6  filmdes  d  nouveau  de  fa9on  d 
obtenir  la  meilleure  image  possible. 


This  item  is  filmed  at  the  reduction  ratio  checked  below/ 

Ctf  document  est  film6  au  taux  de  reduction  indiqud  ci-dessous. 

10X  14X  18X  22X 


12X 


16X 


20X 


JItm 


26X 


30X 


^24X 


28X 


32X 


lire 

details 
lies  du 

modifier 
ger  une 

filmage 


The  copy  filmed  here  has  been  reproduced  thanks 
to  the  generosity  of: 

Library  of  Congress 
Photoduplication  Service 

The  images  appearing  here  are  the  best  quality 
possible  considering  the  condition  and  legibility 
of  the  original  copy  and  in  keeping  with  the 
filming  contract  specifications. 


L'exemplaira  film*  fut  reproduit  grAce  A  la 
gAnirositA  de: 

Library  of  Congress 
Photoduplication  Service 

Les  images  suivantes  ont  AtA  reproduites  avec  le 
plus  grand  soin,  compte  tenu  de  la  condition  et 
de  la  nettet*  de  l'exemplaira  filmA,  et  en 
conformity  avec  les  conditions  du  contrat  de 
filmage. 


i6es 


Original  copies  in  printed  paper  covers  are  filmed 
beginning  with  the  front  cover  and  ending  on 
the  last  page  with  a  printed  or  illustrated  impres- 
sion, or  the  back  cover  when  appropriate.  All 
other  original  copies  are  filmed  beginning  on  the 
first  page  with  a  printed  or  illustrated  impres- 
sion, and  ending  on  the  last  page  with  a  printed 
or  illustrated  impression. 


Les  exemplaires  originaux  dont  la  couverture  en 
papier  est  imprimte  sont  filmAs  en  commenpant 
par  le  premier  plat  et  en  terminant  soit  par  la 
dernidre  page  qui  comporte  une  empreinte 
d'impression  ou  d'illustration,  soit  par  le  second 
plat,  salon  le  cas.  Tous  las  autres  exemplaires 
originaux  sont  filmAs  en  commenpant  par  la 
premiere  page  qui  comporte  une  empreinte 
d'impression  ou  d'illustration  et  en  terminant  par 
la  derniire  page  qui  comporte  une  telle 
empreinte. 


The  last  recorded  frame  on  each  microfiche 
shall  contain  the  symbol  —i»- (meaning  "CON- 
TINUED "),  or  the  symbol  V  (meaning  "END"), 
whichever  applies. 


Un  des  symboles  suivants  apparaftra  sur  la 
darnlAre  image  de  cheque  microfiche,  selon  le 
cas:  le  symbols  — ►  signifie  "A  SUIVRE  ",  le 
symbols  V  signifie  "FIN  ". 


ire 


Maps,  plates,  charts,  etc.,  may  be  filmed  at 
different  reduction  ratios.  Those  too  large  to  be 
entirely  included  in  one  exposure  are  filmed 
beginning  in  the  upper  left  hand  corner,  left  to 
right  and  top  to  bottom,  as  many  frames  as 
required.  The  following  diagrams  illustrate  the 
method: 


Les  cartes,  planches,  tableaux,  etc.,  peuvent  dtre 
filmte  A  des  taux  de  reduction  diff6rents. 
Lorsque  le  document  est  trop  grand  pour  Atre 
reproduit  en  un  seul  clichA,  il  est  filmA  h  partir 
de  Tangle  supArieur  gauche,  de  gauche  A  droite, 
et  de  haut  en  bas,  en  prenant  le  nombre 
d'images  nAcessaire.  Les  diagrammes  suivants 
illustrent  la  mAthode. 


)y  errata 
ed  to 

)nt 

me  pelure, 

apon  d 


1 

2 

3 

32X 


1 

2 

3 

4 

5 

6 

■■■p 


■:^^^it^i^^^:^-i£^,^^:  ,.  r-  ■:  ■::-^-1&:i:::!.,,4^ 


J-ak 


wmmmmmmmmmm 


mmmmmmmmi 


■TV  V.'"  ■  u   ■.rV-'.-'T.^Bli 


CORPORATIONS 


AS    CREATED     AND     REGULATED    BY    THE    STATUTES    AND 

CONSTITUTIONS     OF     THE     VARIOUS     STATES     AND 

TERRITORIES.      ALSO      OF    ,  THE      FEDERAL 

GOVERNMENT,    AND    OF    ENGLAND. 

CANADA,     FRANCE,     AND 

GERMANY. 


l 


By  WILLIAM   wtoOK. 


OF  THKNEW    YORK    BAR. 


iMmraR  OF 


•'  A   TREATISE    ON  STOCK  AND  STOCKHOLDERS  AND  GENERAL  CORPORATION 
LAW,"  AND  "A  TREATISE  ON  TRUSTS." 


A, 


NEW    YORK : 
L.    K.    STROUSE    .V   CO.,    LAW    PUHLISHERS, 
w\  95    NASSAU   STREET. 

1889^ 


&,v41:&i_;*--  ■S-J^MiX-'-^-^ 


'    1 


J-aJ 


ii^i'jriiMiTiMiw 


Copy  i« 


.Ji 


(4 

) 


Si 


COI'VRIGHT,   1889, 
BV 

WILLIAM    W.   COOK. 


*  . 


: 


i 

f 

! 


I 


t. 


mmm 


mtm^f^msmm^^ 


& 


\ 

1 
\ 


I 


I 


•■il 


33  2. 


5^i 


PREFACE. 


This  volume  is  intended  to  servj  as  a  liaiid-hook  for  ready  reference. 
It  has  been  abbreviated,  condensed  and  reduced  to  tiie  smallest  possible 
compass.  Brief  forms  of  expression  have  b^en  used,  and  every  effort 
has  been  made  to  limit  its  size  and  yet  to  state  clearly  all  of  the  impor- 
tant  provisions  that  come  within  the  subject. 

There  have  been  many  treatises  on  corporations  as  affected  by  the 
co"imon  law,  but,  hitherto,  there  has  been  no  attempt  to  collect  and 
reduce  into  compact  order  the  constitutional  and  statutory  provisions  af- 
fecting corporations.  This  is  somewhat  remarkable,  in  view  of  the  fact 
that  the  common  law  relative  to  corporations  is  being  largely  and  rapidly 
displaced  by  constitutional  and  statutory  provisions. 

It  is  no  longer  safe,  in  corporation  matters,  to  rely  upon  the  common 
law.  Constitutions  and  statutes  must  first  be  consulted.  Those  who  are 
about  to  embark  in  a  corporate  r  iterprise  wish  to  know  what  liability  is 
attached  to  their  stock  ;  for  what  kinds  of  business  incorporation  may 
be  had  ;  what  the  liabilities  of  the  directors  may  be  ;  what  incorporation 
fee  is  required  ;  what  taxes  they  and  their  corporation  are  subject  to  ; 
where  corporate  meetings  are  to  be  held  ;  what  is  the  method  of  voting 
at  elections  ;  who  may  be  directors  ;  what  capital  stock  is  allowed  ;  how 
much  land  may  be  owned  by  the  corporation  ;  what  powers  are  con- 
ferred ;  and  all  the  miscellaneous  rights,  duties  and  liabilities  which  are 
created  by  constitutional  and  statutory  provisions.  For  instance,  it  is 
important  to  know  that  in  New  York  and  Pennsylvania,  a  large  sum 
of  money  is  demanded  by  the  state  before  a  charter  is  granted  ;  that 
in  New  Jersey  a  large  annual  fax  is  now  levied  on  corporations  ;  that 
in  Ohio  all  stockholders  are  liable  doubly  on  their  stock  ;  and  that  in 
California  stockholders  are  liable  for  all  corporate  debts.  Each  state 
has  laws  peculiar  to  itself. 

The  plan  of  the  book  is  to  give  .or  each  state  the  provisions,  first,  of 
the  constitution ;  second,  those  affecting  manufacturing  and  miscella- 


r^'»!>a««w»)W«BiCTP5*w:^9R'» 


1-'   ^ 


iv 


PKKFACE. 


M 


neons  corporations;  third,  railroads;  fonrth,  hanks;  fifth,  taxation.  The 
statutory  law  of  the  federal  ^roverninent,  of  the  territories  and  of  En;;land, 
Canada,  France  and  (ierniany  is  also  stated.  In  addition  to  this,  the 
provisions  of  the  federal  constitution,  so  far  as  they  affect  or  protect  cor- 
porations, have  been  explained  and  made  more  clear  by  a  synr  psis  of 
the  decisions  of  the  Supreme  Court  of  the  United  States. 

The  author  has  prepared  this  book  in  connection  with  the  second 
edition  of  his  treatise  on  "  Stock  and  Stockholders  and  deneral  Corpora- 
tion Law."  The  importance  of  such  a  w(jrk  as  this  in  connection  with 
the  general  subject  of  corporation  law  is  manifest, 

Wii.i.iAM  W.  Cook. 

115  Broadway,  New  York. 
OCTOliER  19,  1889. 


<l 


■mmim 


,  taxation.  'I'he 
.ml  of  Eiiglantl, 
in  to  this,  the 
or  protect  cor- 
a  synopsis  of 

ith  the  second 
sneral  Corpora- 
:onnection  with 

M  W.  Cook. 


<^ 


•mm 


CONTENTS. 


CHAPIER  I. 

CONSTirUTIONAI,    ANO    STATUTOKV     PROVISIONS     OF     THK    VARIOUS   STATES 
OF    THK    UNION    IN    REdARD     TO    CORl'ORATIONS. 


8   I. 
2. 

3- 
4- 

5- 
0. 

7- 
8. 

9- 
lo. 
II. 

12. 

13- 
14. 

15- 
16. 

17- 
18. 
19. 
20. 
21. 
22. 

23- 
24. 

25- 

26. 
27. 
28. 
29. 
30- 

31. 

32. 
33- 
34- 

35- 
3(>- 
37- 

38. 

39- 
40. 
41. 
42. 


Alabama. . 
Arkansas.  . 
California. 
Colorado.  . 


rAOB 
I 


12 


Connecticut 15 

Delaware    i,j 

Florida 21 

Georgia 24. 

Illinois 26 

Indiana 28 

Iowa o J 

Kansas n  j 

Kentucky 35. 

Louisiana oy 

Maine ^o 

Maryland 41 

Massachusetts 13 

Michigan ^y 

Minnesota ,;i 

Mississippi ct 

Missouri 


Montana 
Nebraska 
Nevada.  . 


56 
59 

63 

64 

New  Hampshire 55 

New  Jersey '.'...'.'.     69 

New  York y. 

North  Carolina go 

North  Dakota  82 

Ohio g™ 

Oregon ' ....'....'.'.     86 

Pennsylvania gg 

Rhode  Island 


95 

South  Carolina n^ 

South  Dakota qo 

Tennessee 102 

Texas 104 

Vermont 107 

Virginia ....'.  109 

Wachington m 

West  Virginia -jij 

Wisconsin ny 


t 


VI 


CONTKNTS, 


CllAl'lEK    H. 

,.„NSlTn.linNAI,   ANP   STArriORY     PROVISIONS     OK     TItK     TF.RRiroRIKS     OK     TIIK 
i:SJON    IN    RKC.AKD    I'O    roRI'ORATIONS. 

S  4:,.  Arts  of  Congress  in  r.-Kard  to  Corporations  in  the  'I'^-r-'""^''-;'^  .■.■.■.■.'.■.'.'.  '120 

44.  Arizona 121 

45.  lilalio '_ ,22 

46.  New  Mexico .............'.'■.■■    '24 

47.  '.'tall i2(, 

48.  Wyoming 


fONS- 


15  4«}- 
50. 


52. 
53' 


54- 

55. 
56, 


c:iiAi'ii:R  ill. 

TITIIONAI.    AM.   STAI'TORV      .'ROVISIONS     OK     THE    '-KUKKA'.     C.uVKRNMKNT 

.AKFECTINC.  CORPORATIONS. 

I'AnR 

M,,  «,.,fP  «hall  Dass  A  law  "  impairing  the  obligation  of  contracts."    ...    128 
Krerss'lhavx  power  "  t.rregufate  commerce  with  f..re,gn  nations  ^^^ 

.•^-^:^^::^t:^:n  he-en^ltled  to- aiipriviUges-ana-im. 

the  equal  protection  of  the  laws.    .  . ..    • 

Corporations  created  by  the  L  nited  States [\    ]'/,',[ 140 

National  banks • 141 

The  Inter-state  Railway  Act 


CHAPTER  IV. 


STATtn-ORY    PROVISIONS    IN     KSC.LANl),    CANAUA,    KR 

C-.ARI)   TO    CORPORATIONS 


§  57.   England 

58.  Canada 

59.  Quebec 

60.  Nova  Scotia 

61.  New  Brunswick. . . 

62.  Ontario 

63.  British  Columbia. 

64.  France 

65.  Germany 


,\NCE    AND     CEKMANV     IN     RE- 


PAGE 

143 
148 
150 
151 
153 
153 
154 


j^^;^^^/^-:-^:..-:g?5i3:;^jijji:g.>a£:. 


rrnuiKs 

OK 

11  IK 

rics   .  . . 

I  20 

.      1 30 

121 

.    132 

I  aa 

.  .  .  • 

.     I2() 

KAI.     r.oVERNMKNT 

oiitructs.".  ...    128 
oreign  nations 

134 

ileges  and  im- 

136 

ij  corporations  136 
)roperty,  with- 
its  jurisdiction 

138 

1 39 

14" 

I4« 


(.-.EKMANY  IN  RE- 
PAGE 

143 

148 

".".' 150 

151 

153 

153 

154 

■■■ 155 

156 


CORPORATIONS, 

AS    CREATED    AND    REGULATED    BY    STATUTES    AND 

CONSTITUTIONS. 


CHAPTER  I. 

CONSTITUTIONAL    AND    STATUTORY     PROVISIONS   OF   THE    VARIOUS   STATES 
OF   THE    UNION    IN    REGARD   TO   CORPORATIONS. 


§  I.  Alabama. 

3.  Arkansas. 

3.  California. 

4.  Colorado. 

5.  Connecticut. 

6.  Delaware. 

7.  Florida.^ 

8.  Georgia^. 

9.  Illinois. 

10.  Indiana. 

11.  Iowa. 
13.  Kansas. 


8  15- 

Maine. 

8   29- 

North  Dakota. 

16. 

Maryland. 

30- 

Ohio 

17- 

Massachusetts. 

31- 

Oregon. 

18. 

Michigan. 

32. 

Pennsylvania. 

19. 

Minnesota. 

33- 

Rhode  Island. 

30. 

Mississippi. 

34- 

South  Carolina 

31. 

Missouri. 

35- 

South  Dakota. 

22. 

Montana. 

36. 

Tennessee. 

23. 

Nebraska. 

37- 

Texas. 

34. 

Nevada. 

38. 

Vermont. 

25. 

New  Hampshire, 

39- 

Virginia. 

26. 

New  Jersey. 

40. 

Washington. 

27. 

New  York. 

41- 

West  Virginia. 

28. 

North  Carolina. 

42. 

Wisconsin. 

13.  Kentucky. 

14.  Louisiana. 


g  1.  ALABAMA.  Constitntional  Provisions. — The  right  of  eminent 
domain  shall  not  be  construed  to  allow  taxation  or  forced  subscription 
for  the  benefit  of  railroads,  or  other  corporations,  except  municipal, 
Constitution  of  1875,  Art.  I.,  §  24.  Guardians,  trustees,  etc.,  shall 
not  invest  trust  funds  in  the  bonds  or  stock  of  private  corporations, 
Art.  IV.,  §  35.  The  state  shall  not  be  interested  or  lend  its  money  or 
credit  to  a  corporate  enterprise,  §  54.  The  general  assembly  shall 
not  authorize  any  municipality  "to  lend  its  credit,  or  to  grant  public 
money  or  thing  of  value  in  aid  of,  or  to  any  individual,  association 
or  corporation  whatsoever,"  or  become  a  stockholder  or  bondholder 
in  such,  §  55.  The  state  tax  is  not  to  exceed  three  quarters  of  one  per 
cent ;  county,  etc.,  tax  not  to  be  over  one-half  of  one  per  cent.  Cor- 
porate property  shall  be  taxed  at  the  same  rate  as  individual's  prop- 
erty. Art.  XI.  Corporations  may  be  created  by  special  act  for  manu- 
facturing, mining,  industrial  purposes;  for  constructing  canals,  im- 
proving rivers  and  harbors,  and  where  otherwise  judged  necessary 
to  attain  the  purposes  thereof,  Art.  XIV.,  g  i.      Foreign  corporations 


'i! 


i      I  r  i  I 


*f  w 


g  1  ALABAMA.  ■ 

must  have  a  place  of  business  and  an  authorized  agent  in  the  state, 
Art,  XI V,  8  42.      "  No  corporation  shall  engage  in  any  business  other 
than  that' expressly  authorized   in    its  charter,"  §  5.      No  corporation 
shall  issue  stock  or  bonds,  except  for  money,  labor  done,  or  money  or 
property  actually  received,  and  all  fictitious  increase  of  stock  or  indebt- 
edness shall  be  void.     Neither  stock  nor  bonded  debt  shall  be  increased 
without  the    consent  of  a  majority  in  value  of    the   stockholders  ob- 
tained at  a  meeting,  noticed  thirty  days,  g  6.    There  is  no  liability  of 
stockholders  beyond  the  unpaid  subscription,  §  8.    Corporations  shall 
not  issue  preferred  stock,  except  on  the  consent  of  two-thirds  in  interest, 
§  9      No  bank  shall  be  established  otherwise   than  under  a  general 
banking  law,  g  15.     The  state  shall  not  be  a  stockholder  in,  or  give 
credit  to  any  bank,  §  20.      Railroads  and  transportation  companies 
are  forbidden  to  grant  free  passes  or  special  rates  to  members  of  the 
legislature  and  state  or  federal  officers,  §  23.      No  street  railroad  shall 
be  constructed  without  the  consent  of  the  local  authorities,  g  34. 

Miscellaneous  Corporations.— Special  provision  is  made  for  the  incor- 
poration of  banks,  insurance  companies,  mining,  quarrying  and  manu- 
facturing companies,  railroad  and  street  railroad  companies,  toll-road, 
navigation  and  telegraph  companies. 

Two  or  more  may    incorporate   "for  any   lawful  enterprise  if  not 
otherwise  provided  by  law,"  Civil  Code  1887,  §  1659.     Declaration  is 
to  be  filed  in  office  of  probate  judge,  g  1660.     The  judge  issues  a  com- 
mission to  take  subscriptions,  §1661.     Subscriptions  must  be  payable 
in  money,  but  the  commissioner  may  accept  labor  and  property,  g  1662. 
May  organize  when  fifty  per  cent  of  stock  has  been  subscribed  in  good 
faith.     Twenty  per  cent  shall  be  paid  in  at  the  time  of  organization 
or  written  contracts  made  for  substituted  services  or  property,  which 
facts  being  verified  by  affidavits  duly  filed,  the   probate  judge  issues 
charter,  §  1663.     May  not  borrow  to  exceed  the  amount  of  the  capi- 
tal stock.     Mortgage  not  to  be  made  except  by  a  majority  vote  at  a 
meeting  specially  called  on  thirty  days'  notice,  §  1664.     Stockholders 
meet  annually  at  a  time  and  place  fixed  by  the  by-laws,  gg  1666,  1681. 
The  capital  stock  may  be  increased  by  a  majority  vote  and  with  the 
same   formalities   as  supra,  but  not  to   exceed   one   million  dollars  ; 
each  stockholder  has  a  preference  in  taking  a  proportionate  amount  of 
the  increase,  g  1667.    Must  require  a  register  of  stock  transfer  on  the 
'     books.     Anon-registered   transfer  is  void  after  fifteen  days,  g   1671. 
Shares  are  subject  to  levy  and  sale  under  attachment  or  execution, 
§  1673.      All  private   corporations  have  a  lien    on  shares   of    stock- 
holders for  any  debt  or  liability  incurred  before  notice  of  transfer  or  of 
a  levy  on  such  shares.  §  1674.      Failure  to  organize  for  two  years  is  a 


-  ViS  ferfwi 


it  in  the  state, 
business  other 
4o  corporation 
e,  or   money  or 
stock  or  indebt- 
all  be  increased 
ockholders  ob- 
s  no  liability  of 
rporations  shall 
lirds  in  interest, 
nder  a  general 
)lder  in,  or  give 
ition  companies 
nembers  of   the 
set  railroad  shall 
:ies,  §  24. 
de  for  the  incor- 
ying  and  manu- 
panies,  toll-road, 

enterprise  if  not 
>.     Declaration  is 
Ige  issues  a  corn- 
must  be  payable 
property,  §  1662. 
jbscribed  in  good 
J  of  organization 
r  property,  which 
bate  judge  issues 
junt  of  the  capi- 
[lajority  vote  at  a 
34.     Stockholders 
vs,  §§  1666,  1681. 
ote  and  with  the 
;   million  dollars  ; 
rtionate  amount  of 
transfer  on  the 
een  days,  §  167 1. 
lent   or  execution, 

shares  of    stock- 
:e  of  transfer  or  of 

for  two  years  is  a 


ALABAMA. 


8   1 


forfeiture,  as  i.i  non-user  for  five  consecutive  years,  J{  1676,  Cor- 
porate books  shall  be  open  to  the  inspection  of  stockholders,  g  1677. 
A  majority  in  interest  may  increase  or  diminish  the  number  of  direct- 
ors, 55  1680,  Directors  may  call  special  meetings  of  the  .stockholders. 
Each  share  has  one  vote,  j|  1681.  The  probate  judge  shall  keep  a 
record  of  incorporation  and  organization,  and  receive  a  small  fee 
therefor,  }}  1682.  Unpaid  subscriptions  are  subject  to  garnishment 
by  a  judgment-creditor  of  the  corporation,  g  2972. 

Charter*  may  be  amended  by  a  two-thirds  vote  of  all  the  stock,  L. 
1889,  p.  20.     Defects  in  incorporation  may  be  cured,  L.  1889,  p.  74. 

Stockholders'  meetings  may  be  held  out  of  the  state,  on  filing  the 
written  consent  of  resident  stockholders,  and  on  appointing  an  agent 
and  keeping  an  office  in  the  state.  Must  file  a  copy  of  proceedings  at 
such  office.  L.  1889,  pp.  76,  iii. 

Preferred  stock  may  be  issued  on  a  two-thirds  vote  of  the  stock,  L. 
1889,  p.  86. 

Land  companies  may  borrow,  etc.,  L.  1889,  p.  108. 
Railroads. — Seven  or  more  may  incorporate,  g  1573.  Declaration 
is  to  be  filed  with  the  secretary  of  state,  §  1574.  He  issues  a  com- 
mission to  take  subscriptions,  §  1575.  Subscriptions  must  he  paya- 
ble in  money,  but  the  commissioners  may  permit  them  to  be  discharged 
in  services  or  property,  §  1577.  Organization  begins  when  ten  per 
cent  of  the  capital  is  subscribed  in  good  faith.  Two  per  cent  must  be 
paid  in.  Affidavits  being  filed  with  secretary  of  state,  he  issues  the 
charter,  §  1578.  He  keeps  a  record  of  all  proceedings  and  receives  a 
fee  of  $2,  plus  fifteen  cents  per  folio  of  the  record,  §  1579.  May  bor- 
row money  by  mortgage  or  deed  of  trust  of  franchises  and  property; 
may  issue  negotiable  bonds  or  bills  of  exchange,  or  promisory  notes  in 
any  form,  §  1580  (14).  Consolidation  of  connecting  roads  are  pro- 
vided for.  Each  railroad  must  assent  by  a  two-thirds  stock  vote  and 
dissenting  stockholders  must  be  paid  at  least  par  for  their  shares.  The 
new  corporation  must  keep  an  office  in  Alabama  and  be  a  domestic 
corporation,  g§  1583-1585.  May  aid,  purchase  or  lease  another 
railroad  or  enter  into  a  traffic  arrangement.  A  majority  of  the  stock 
must  consent.  Extended  to  foreign  railroad  companies,  §  1586  and 
note.  Railroad  may  increase  its  capital  to  $10,000,000  by  a  majority 
stock  vote  and  due  formalities,  §  1589.  Bonded  indebtedness  can 
only  be  increased  by  a  majority  stock  vote  at  special  meeting,  §  1590. 
Stockholders  must  meet  annually  at  a  time  and  place  fixed  in  the 
by-laws,  §  1591.  Proxies  are  authorized.  Each  share  has  one  vote, 
§  1592.  Directors  must  own  and  hold  stock  in  good  faith,  §  1593. 
Stockholders'  and  directors'  meetings  may  be  held  out  of  the  state  upon 


^ 


¥ 


a   I  ALABAMA,  * 

the  written  and  verified  consent  of  all  resident  stockholders.  But  must 
have  an  office  and  agent  within  the  state,  §§  iS94,  i595-  Purchasers 
of  railroad  may  be  incorporated,  g§  1596-1598-  Certificates  of 
stock  are  not  to  be  issued  until  fully  paid  up.  Office  may  be  kept,  oy 
the  directors  out  of  tlie  state  for  the  transfer  of  shares  held  by  non- 
residents, §  i&oi.  A  board  of  railroad  commissioners  are  to  consider 
railroad  rates  and  "notify"  the  railroads  of  excessive  charges,  L.  1881, 
p.  84,  L.  1883,  p.  177.  Their  decision  is  prima  facie  evidence  that 
the  rate  is  too  high,  L.  1883,  p.  178. 

Banks.— No  banking  corporation  can  be  formed  without  at  least 
three  stockholders,  or  without  a  capita!  subscribed  in  good  faith  of  at 
least  $so  000  of  which  not  less  than  twenty  percent,  and  m  no  case  less 
than  $25,000  must  be  actually  paid  by  the  subscribers  for  stock  before 
the  filing  of  the  declaration,  §  1522.  Declaration  and  affidavit  to  be 
filed  with  probate  judge  of  county,  §  1523-  Certified  transcript  to  be 
filed  with  secretary  of  state,  who  issues  and  records  certificate  of  incor- 
poration §  1524.  Must  be  at  least  three  directors,  all  stockholders  m 
good  faith  §  1526.  Capital  may  be  increased  not  to  exceed  $500,000, 
or  decreased  to  not  less  than  $50,000  at  special  meeting  duly  noticed, 
upon  majority  stock  vote,  under  due  formalities,  §  1527. 

Mining,  etc.,  Companies—The  special  provisions  for  the  incorpora- 
tion of  mining,  quarrying  and  manufacturing  corporations,  are  the 
same  as  the  general  provisions,  sufra,  see  g§  155?  'f  ^'9-  Such  com- 
panies have  additional  power  to  build,  buy  and  operate  railroads,  canals 
roads  etc.,  to  and  from  their  works  ;  they  may  build  depots  and 
wharves  and  buy  or  charter  vessels,  or  aid  railroads  or  boat  lines 
running  to  and  from  such  depots  and  wharves,  §  1563.  Such  companies 
may  consolidate  by  majority  of  stock  vote  of  each  company,  §^ 
1 16^-1569  Capital  stock  may  be  increased  with  due  formalities  by 
majority  stock  vote  at  special  meeting  properly  noticed,  but  shall  not 
exceed  ten  million  dollars  and  each  stockholder  has  preference  in  taking 
nroportionate  amount  of  increase,  §  1572-  ,.        ■ 

Taxation  -Shares  of  stock  are  not  taxed  against  holders  when  the 
corporate  property  is  listed  in  this  state,  §  45  ^  (8)-  AH  bank  shares 
are  taxed  against  resident  and  non-resident  owners  at  place  of  bank  and 
tax  is  paid  by  bank.  Banks  shall  make  full  return  of  shares  and  stock- 
holders and  the  fair  market  value.  The  value  of  real  and  personal 
property  is  deducted  from  whole  assessment.  Shares  so  assessed  may 
be  treated  by  owners  as  money  loaned,  etc.,  and  they  may  deduct  their 
indebtedness  therefrom,  §  453  (8).  The  capital  stock  of  all  corpora- 
tions not  invested  in  property  otherwise  listed,  is  taxed  against  the  com- 
panies; but  stock  and  shares  both  shall  not  be  taxed.    Id.  (9).      All 


ARKANSAS. 


§2 


l.^t 


rs.  But  must 
Purchasers 
Certificates  of 
lay  be  kept  oy 
held  by  non- 
ire  to  consider 
irges,  L.  1881, 
evidence    that 

ithout  at  least 
3od  faith  of  at 
in  no  case  less 
r  stock  before 
affidavit  to  be 
ranscript  to  be 
ificate  of  incor- 
stockholders  in 
ceed  $500,000, 
r  duly  noticed, 

7- 

•  the  incorpora- 

ations.  are    the 

q.      Such  com- 

lilroads,  canals, 

ild  depots  and 

5  or  boat  lines 

Such  companies 

h  company,   §§ 

e  formalities  by 

1,  but  shall  not 

'erence  in  taking 

jlders  when  the 
Ml  bank  shares 
ace  of  bank  and 
hares  and  stock- 
al  and  personal 
io  assessed  may 
lay  deduct  their 
c  of  all  corpora- 
igainst  the  com- 
.    Id.  (9).      All 


railroad  property  is  taxed,  Id.  (11).  All  dividends  declared  or  earned 
and  not  divided  are  taxed.  Id.  (12).  Insurance,  telephone  and  sleeping 
car  companies  are  taxed  on  gross  receipts,  §  454,  Corporate  property  at 
estimated  value,  including  capital  stock  at  market  value,  is  to  be  reti'rned 
by  chief  officer;  and  where  taxes  are  assessed  and  paid  thereon,  the 
shares  of  such  stock  shall  not  be  taxed,  §  478.  >, 

§  2.  ARKANSAS.  Constltntional  ProYlslons.— No  obligation  or  lia- 
bility of  any  railroad  or  other  corporation  held  by  the  stale  shall  ever 
be  exchanged,  transferred,  remitted,  postponed  or  in  any  way  diminished 
by  the  general  assembly.  Art.  IV.,  §  ij^.  The  general  assembly  may, 
by  general  law,  exempt  from  taxation  for  seven  years  the  capital  in- 
vested in  mining  and  manufacturing  business.  Art.  X.,  §  3.  Special 
charters  are  prohibited.  Art.  XII.,  §  2.  Municipalities  shall  not  aid 
corporations.  Id.  §  5.  Nor  the  state,  Id.  §  7.  Fictitious  stock  and 
bonds  are  void;  neither  stock  nor  bonded  indebtedness  shall  be  increased 
except  by  majority  stock  vote  at  meeting  specially  noticed.  Id.  §  8. 
Foreign  corporations  doing  business  in  the  state  must  have  an  office  and 
authorized  agent  in  the  state,  and  can  exercise  no  greater  powers  than  do- 
mestic corporations  have,  and  shall  not  have  power  to  condemn 
property.  Id.  §  II.  Power  to  tax  corporations  and  corporate  property 
shall  not  be  surrendered  or  suspended  by  any  contract  or  grant  to 
which  the  state  may  be  a  party,  Art.  XVI.,  §  7.  Maximum  rate  of 
state  taxes  is  one  per  cent  of  assessed  valuation.  Id.  §  8;  of  county 
taxes,  one-half  of  one  per  cent,  Id.  §  9.  Transfer  books  of  railroad 
companies  are  to  be  left  at  office  of  the  company  in  the  state  and  open  to 
inspection- of  stockholders  and  creditors.  Art.  XVII.,  §  2.  Parallel  or 
competing  lines  are  not  to  consolidate  or  be  controlled  by  the  same  parties, 
Id.  §  4.  Officers  of  railroad  companies  are  not  to  be  interested  in  con- 
tract with  a  company  furnishing  material  or  supplies  or  with  transpor- 
tation company  doing  business  with  it.  Id.  §5.  General  assembly  shall 
prevent  granting  of  free  passes  by  railroads  to  state  officers,  Id.  §  7. 
Railroads  shall  make  annual  report  to  state  auditor,  Id.  §  13.  Rolling 
stock  to  be  personalty.  Id.  §  11. 

Miscellaneons  Corporations.— Three  or  more  may  incorporate  for  any 
lawful  business,  R.  S.  1884,  §  960.  Secretary  and  treasurer  must  be 
residents  and  must  keep  their  books  within  the  state,  §  966.  Annual 
statement  of  condition  of  corporation  to  be  filed  with  county  clerk. 
No  transfer  of  stock  is  complete  until  filed  with  same,  §  971.  Corporate 
books  to  be  cp?n  to  inspection  of  stockholders,  §  974.  Stockholders 
may  amend  the  charter,  §  976.  For  failure  to  file  statement  with  county 
clerk  or  to  perform  any  other  statutory  duty,  directors  are  liable  for 


:  /    '(■ 


i^N 


IMMIHIIIWnMlii 


§2 


ARKANSAS. 


e 


corporate  debts,  §§  980,  984.     Stockholders  may  increase  capital  stock 
at  any  meeting  specially  warned,  §§  961,  977.     Purposes   shall  be  dis- 
tinctly stated  in  the  articles  and  not  departed  from,  §  962.     Shall   have 
not  less  than  three  directors,  all  stockholders,  §  964.     May  not  coir.- 
mence  business  until  copy  of  articles  and  certificate  signed  and  verified 
by  president  and  majority  of  board  shall   have  been  filed  in  stale  and 
county,  §§  908,   979.     At  all  meetings  each  share  has  one  vote,  §  969. 
An  annual  verified   certificate  shall  be    filed  with   county  clerk,  with 
whom  also  certificate  of  every   stock  transfer  must  forthwith  be  de- 
posited. Until  then   the  transfer  is  void  against  creditors,  §§  971,  979. 
May  hold  real  estate  necessary  for  its  purposes  and  to  secure  debts  and 
may  manage  and  dispose  of  it  at  pleasure,  §  973.  Corporations  have  lien 
upon  all  the  stock  or  property  of  members  invested  therein  for  all  debts 
due  from  them  to  corporation,  §  975.     Amendment  shall   be  by   some 
formalities  as  original  incorporation  {supra,  §  968),  and  special  adver- 
tisement, §  976.     Corporate  lien  on  stock  may  be  enforced  by  a   sale 
thereof,  §  983,  etc.     May   sell  equity  of  redemption  in  pledged  shares, 
§988. 

Railroads Five  or  more  may  incorporate,  §  5420.    Transfer  books 

are  closed  for  elections  thirty  days;  stockholder  voting  must  have  owned 
stock  for  thirty  days,  §§  5425,  5509.    Directors  must  be  stockholders. 
One-third  of  directors  shall  be  residents  of  some  county  or  counties  on 
line  of  railroad,  Id.  §  5426,  and  see  §  5505  infra.   Stockholders  holding 
one-third  of  the  stock  may  call  a  corporate   meeting,  §  5429.      Major- 
ity in  interest  of  the  stock  may  remove  the  president  or  directors^ 
§  5431.    Directors  may  make  by-laws,  §  5435.    Corporation  not  to  pur. 
chase  its  own  stock,  nor  stock  in  other  corporations,  §  5436.     Directors 
are  liable  for  all  corporate  debt,  if  they  rnake  false  report,  certificate, 
etc.    §  5439.      Majority  of  directors  must  be  citizens  and  residents  of 
the  state,  §  5505.     Articles  are  void,  if  within  two  years  five  per  cent  of 
subscribed  stock  is  not  paid  in,  and  preliminary  survey  filed.      Affida- 
vits of  three  directors  must  show  that  $1,000  per  mile  is  subscribed, 
and  five  per  cent  paid,  §§  5420,  5421.      First  meeting  for  election  shall 
be  on  line  of  road,  §  5425  ;  and  so  also  subsequent  elections,  §  5428. 
Majority   present  at  any  meeting  may  demand  statement  of  affairs, 
§  5431.    Stock  is  not  transferable  until  previous  calls  are  paid,  §  5436. 
Purchasers  of  railroads  may  incorporate,  §§  5448-5451.      Franchises 
and  all  property  may  be  mortgaged,  §  5453..     Increase  of  capital  stock 
and  power  to  mortgage,  §  5488.    Offices  of  chief  officers  and  corporate 
books  to  be  kept  in  the  state,  and  open  to  inspection  of  stockholders, 
§  5506.      Charter  to  be  forfeited  for  violation,  §  5507.    Consolidations 
authorized,  §§5511,  etc.      Must  be  approved  by  two-thirds  in  interest 


•^m 


itm 


m!iP!'jm\M  \3mm- 


e 


CALIFORNIA. 


§   3 


capital  stock 
shall  be  dis- 
Shall  have 
ay  not  corr.- 
d  and  verified 
in  state  and 
le  vote,  §  969. 
ty  clerk,  with 
:hwith  be  de- 

5.  §§971,  979- 
ure  debts  and 
ions  have  lien 

n  for  all  debts 
be  by   some 

special  adver- 
ed  by  a  sale 
ledged  shares, 

rransfer  books 
asthave  owned 

stockholders, 
or  counties  on 
lolders  holding 
5429.  Major- 
t  or  directors^ 
tion  not  to  pur- 
.36.  Directors 
)ort,  certificate, 
id  residents  of 
five  per  cent  of 
filed.      Affida- 

is  subscribed, 
ir  election  shall 
;ctions,  §  5428. 
lent  of  affairs, 
re  paid,  §  5436. 
[.  Franchises 
of  capital  stock 
i  and  corporate 
)f  stockholders, 

Consolidations 
hirds  in  interest 


of  all  issued  capital  stock  in  respective  companies,  §  5512.  Parallet" 
and  competing  lines  not  to  consolidate,  §  5514.  Resolutions  and 
agreements  to  be  filed  with  secretary  of  state,  §§  5513,  SS^S'  P"""" 
chase,  lease  and  aid  of  and  to  connecting  lines  authorized  upon  approval 
of  two-thirds  in  interest  of  stockholders,  §§  5516  et  seq.  Non-resident 
corporations  leasing,  owning  or  operating  domestic  lines,  must  keep  of- 
fice, agents  and  books  within  state,  §§  5523  ^/j<f^.  Foreign  corpora- 
tions may  assume  debt  of  purchased  or  leased  railroad,  and  issue  its 
own  securities  in  any  form  therefor,  §  5532.  Railroads  must  build 
five  miles  within  eighteen  months  after  incorporation,  under  penalty  of 
charter  being  void,  L.  1889,  ch.  22. 

A  consolidated  company,  or  a  purchaser  of  a  railroad,  shall  be  liable 
for  the  debts  of  the  road  consolidated  or  purchased,  L.  1889,  ch.  55. 

Statute  prohibiting  foreign  railroads  from  operating  in  state,  repealed. 
A  domestic  railroad  company  may  lease  or  sell  its  road  and  property  to 
a  foreign  corporation  whose  lines  connect  with  it,  or  to  another  con- 
necting domestic  railroad  company.  One  railroad  may  buy  or  guaran- 
tee the  stock  or  bonds  of  a  connecting  company.  In  all  cases,  however, 
a  two-thirds  vote  of  all  the  stock  of  each  company  is  necessary  to  the 
validity  of  the  act.  Foreign  companies  may  build  a  connecting  line  in 
the  state.  But  in  all  cases  the  foreign  company  must  file  a  copy  of  its 
charter,  and  it  is  thereby  to  become  a  domestic  corporation.  Existing 
foreign  corporations  operating  a  road  in  the  state  must  do  the  same,  L. 
1889,  ch.  34. 

Taxation. — Capital  stock  of  corporations  is  taxed  as  personalty,  §  5585. 
All  corporate  property  is  taxed,  and  all  investments  in  bonds,  stock, 
etc.,  of  residents,  §§  5586,  5620.  But  not  if  any  portion  of  the  corporate 
property  or  capital  stock  is  taxed,  §  5612.  Banks  shall  annually  make 
attested  statement  to  assessor,  showing  capital,  undivided  profits, 
federal  and  state  securities  not  taxed  and  deposits  for  terms  certain. 
The  gross  sum  of  these  shall  be  deemed  the  banking  capital  for  that 
year,  §§  5629-5631,  am'd  L.  1887,  p.  150.  Shares  not  listed  to  holders 
shall  be  listed  by  president  and  the  tax  paid  by  bank,  to  be  retained  out 
of  dividends,  §§  5632,  5633.  Telegraph  companies  are  taxed  on  gross 
receipts.  Express  companies  on  gross  receipts  less  amount  actually 
paid  to  domestic  railroads,  for  transportation,  §  5640.  Railroads  are 
assessed  by  a  state  board,  who  apportion  the  assessment  among  the 
counties,  §§  5647,  etc.  The  act  March  38,  1887,  amends  revenue  laws  in 
many  details,  L.  1887,  pp.  143,  etc. 


§  3.    CALIFORNIA.    Constitutional  Prorlslons. — "  No  special  priv- 
ileges or  immunities  shall  ever  be  granted  which  may  not  be  altered, 


i'l 


^BS? 


§  8 


CALIFORNIA. 


8 


fevoked  or  repealed  by  the  legislature,"  Art.  I.,  §21.  No  special  law 
shall  be  enacted  "chartering  or  licensing  ferries,  bridges  or  roads," 
Art.  I.,  §  25.  Neither  the  state  nor  any  political  division  thereof  is,  or 
may  be,  authorized  to  loan  its  credit  to,  or  aid,  or  become  a  stoc!:- 
holder  in,  any  corporation,  Art.  I.,  §  32.  Telegraph  and  gas  rates  shall 
be  regulated  by  law,  and  where  a  person  is  to  be  appointed  to  regulate  or 
limit  charges,  such  person  shall  not  be  an  officer  or  stockholder  in  any 
company  affected,  Art.  I.,  §  33.  State  shall  not  aid  corporations.  Art.  IV., 
§  22.  No  special  law  shall  grant  to  any  corporation  any  special  or 
exclusive  right,  privilege  or  immunity.  Id.  §25.  "The  legislature 
shall  pass  laws  to  regulate  or  prohibit  the  buying  and  selling  of  the 
shares  of  the  capital  stock  of  corporations  in  any  stock  board,  stock 
exchange  or  stock  market  under  the  control  of  any  association.  All 
contracts  for  the  sale  of  shares  of  the  capitil  stock  of  any  corporation 
or  association,  on  margin,  or  to  be  delivered  at  a  future  day,  shall  be 
void,  and  any  money  paid  on  such  contract  may  be  recovered  by  the 
party  paying  it  by  suit  in  any  court  of  competent  jurisdiction,"  Art.  IV., 
§  26.1  Legislature  shall  not  authorize  municipalities  to  aid  corporations, 
Id.  §  31.  The  privilege  to  lay  water  and  gas  pipes  in  cities  shall  be 
granted  upon  the  condition  that  the  municipal  government  may  regu- 
late the  charges,  Art.  XI.,  §  19.  Corporations  shall  not  be  created  by 
special  act.  Art.  XII.,  §  i.  Stockholders  in  all  corporations  are  "  indi- 
vidually and  personally  liable  for  such  proportion  of  all  its  debts  and 
liabilities  contracted  or  incurred  during  the  time  he  was  a  stockholder, 
as  the  amount  of  stock  or  shares  owned  by  him  bears  to  the  whole  of 
the  subscribed  capital  stock  or  shares  of  the  corporation  or  association.'"' 
Directors  are  liable  for  the  embezzlements  or  misappropriations  of 
officers.  Id.  §  3.  Banks  may  be  formed  under  general  laws  and  not 
by  special  act,  Art.  XII.,  §  5.  Corporations  shall  not  hold  realty  longer 
than  five  years,  except  that  necessary  for  its  business.  Id.  §  9.'  Fic- 
titious stock  and  bonds  are  void.  Id.  §  11.*  Cumulative  voting  pro- 
vided for,  Id.  §  i2.'>  State  shall  not  aid  corporation,  Id.  §  13,  Books 
containing  names  of  stockholders,  etc.,  and  assets  and  liabilities  of  the 
corporation  to  be  kept  .in  state,  open  to  interested  parties.  Id.  § 
14."  Officers  shall  not  be  interested  adversely  to  the  corporation. 
Id.  §  iS.'  Free  passes  to  those  holding  offices  of  honor,  trust  or 
profit  in  the  state  are  prohibited.  Id.  §  19.  Provision  is  made  for  the 
alection    of   three    railroad    commissioners    and    their    powers    are 

•  See  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xx, 

§§  341-347- 
« Id. .  chapter  xii.  *Id.,  chapter  xli,  §  692.  *  Id.,  chapter  Hi,  §§  26-28. 

•  Id. ,  chapter  xxxvii.  •  /d. ,  chapter  xxx.  '/</.,  chapter  xxxix. 


■^-^ 


8 

No  special  law 
jes  or  roads," 
1  thereof  is,  or 
come  a  stoc!;- 
gas  rates  shall 
i  to  regulate  or 
cholder  in  any 
tions,  Art.  IV., 
any  special  or 
rhe  legislature 

selling  of  the 
c  board,  stock 
sociation.  All 
ny  corporation 

day,  shall  be 
overed  by  the 
on,"  Art.  IV., 
d  corporations, 
cities  shall  be 
ent  may  regu- 
;  be  created  by 
ions  are  "  indi- 

its  debts  and 

a  stockholder, 
)  the  whole  of 
r  association.''* 
propriations  of 
1  laws  and  not 
d  realty  longer 
[d.  §  9.8  Fic- 
ive  voting  pro- 
l.  §  13.  Books 
labilities  of  the 
parties,  Id.  § 
le  corporation, 
honor,  trust  or 

made  for  the 
ir    powers    are 

Law,  chapter  xx, 

pter  Hi,  §§  26-28. 
ipter  xxxix. 


« 


CALIFORNIA. 


8  3 


defined,  §  22.  Bonds,  stocks  and  franchises  shall  be  taxed,  Art.  XIII. , 
§  1.*  Railroads  are  to  be  assessed  on  their  franchise,  roadbed,  roadway, 
rails  and  rolling  stock  by  a  state  board,  and  the  assessment  apportioned 
among  the  municipalities  through  which  they  run,  according  to  the 
number  of  miles  in  each,  Art.  XIII.,  §  10.'  Corporations  are  forbidden 
to  employ  Chinese  or  Mongolians,  Art.  XIX.,  §  2. 

Miscellaneous  Corporations,  Incladlngr  Railroads. — Five  or  more  may 
incorporate,  but  majority  must  be  residents.  Civil  Code,  §  285.  May 
incorporate  for  any  purpose  for  which  ''individuals  may  lawfully  asso- 
ciate themselves,"  Id.  §  286.  Railroads  and  telegraph  companies 
cannot  be  incorporated  until  $1,000  and  $100  per  mile  respectively  have 
been  subscribed  and  ten  percent  of  the  whole  subscription  has  been  paid 
in,  §§  293,  294,  295.  Corporations  must  file  copy  of  articles  of  incor- 
poration in  every  county  in  which  they  hold  property.  Id.  §  299.  By- 
laws to  be  adopted  by  stockholders.  Id.  §  301.  Directors  must  be 
stockholders  and  a  majority  to  be  citizens  of  the  state,  Id.  §  305.'  Cumu- 
lative voting  prevails.  Id.  §  307.*  Directory  not  to  create  debts  beyond 
the  subscribed  capital  stock.  Id.  §  309.'  Directors  may  be  removed  by 
a  two-thirds  vote  of,  the  stockholders,  or  by  a  two-thirds  vote  in  interest. 
Meeting  for  this  purpose  may  be  called  by  one-half  in  interest  of  stock- 
holders, Id.  §  310.  Where  there  is  no  person  authorized  to  call  a 
meeting,  a  justice  of  the  peace  may  do  so  on  written  application 
of  three  stockholders.  Id.  §  311.  Majority  of  stock  must  be  repre- 
sented at  all  meetings.  Stockholders  only  of  ten  days'  standing  may 
■vote  at  meetings,  Id.  §  312.  Courts  are  given  jurisdiction  to  rectify 
irregular,  etc.,  elections,  Id.  §  315.'  Officer  willfully  making  false  re- 
ports, etc.,  is  liable  personally,  Id.  §  316,  and  see  act  March  29,  1878, 
p.  82,  of  Deering's  Civil  Code,  1885.  Meetings  of  stockholders  and 
directors  must  be  held  at  the  principal  place  of  business,  Id.,  319.'  Banks 
must  keep  open  to  public  a  book  containing  names  of  stockholders  and 
shares  held  by  them,  also  shares  held  by  the  directors.  Id.  §321.''  Stock- 
holders are  liable  for  corporate  debts.^  Suits  to  enforce  liability  may 
be  joint  or  several.  Separate  judgment  rendered.  Liability  determined 
by  amount  of  stock  held  when  debt  was  incurred.  No  release  there- 
from by  transfer.'  Those  owning  stock  in  name  of  another  are  liable 
herein.  The  liability  of  stockholders  in  foreign  corporations  doing 
business  in  the  state  is  the  same  as  of  stockholders  in  domestic  corpo- 


'  See  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law, 

chapter  xxxiv. 
^  /J.,  chapter  xxxiv.  *  /</.,  chapter  xxxvii.     *  Id.,  chapter  xxxvii. 

'/(/.,  chapter  xli,  §685.  */</.,  chapter  xxxvi.      ^/i/.,  chapter  xxx, 

*  Id. ,  chapter  xii. ,  37  Fed.  Rep. ,  404.    '  Id. ,  chapter  xv. 


"nn 


1 1 


\-im< 


«i 


§  3 


CAUFORNIA. 


10 


rations,  Id.  §  322.  (See  constitutional  provision,  supra).  Mode  of 
increasing  the  bonded  debt  or  capital  stock  is  prescribed  by  statute. 
By-laws  may  regulate  notices  of  meetings,  voting  by  proxy,  qualifica- 
tions of  officers,  penalties,  etc.  ch.  249,  L.  1S89. 

The  following  provisions  are  also  applicable  to  railroads.      Trans- 
fers of  stock  not  allowed,  if  calls  are  due  and  unpaid,  nor  if  less  than 
twenty  per  cent,  has  been  paid  thereon,  nor  unless  the  transfer  is  ap- 
proved by  the  board.  Id.  §  455.    May  borrow  money  on  notes  or  bonds, 
up  to  amount  of  capital  stock,»  and  mortgage  all  their  property,  or  se- 
cure the  debts  by  deeds  of  trust,  in  which  resident  or  non-resident  per- 
sons or  corporations  may  be  trustees,  §  456.      Must  provide  sinking 
fund  to  pay  bonds,  and  may  provide  for  their  conversion  into  stock 
within  eight  years,  §  457.'     Capital  stock  must  be  fixed  by  a  two-thirds 
vote  of  stockholders,  and  certificate  filed,  §  458.     Verified  certificate 
of  payment  of  fixed  capital  to  be  filed  within  thirty  days  after  payment 
oi  last  installment,  §  459.     Railroads  must  begin  construction  within 
two  years,  and  must  put  in  operation  five  miles  every  year  thereafter,  or 
forfeit  charter,  §  468.'     Foreign  railroads  may  operate  within  the  state 
the  same  as  resident  companies.  Act  April  3,  1880,  Deering's  Civ.  C, 
p.  124.*     Consolidation    authorized  upon    written  consent  of    three- 
fourths  in  value  of  stockholders,  §.473.     Free  passes,  except  to  speci- 
fied persons,  are  prohibited,  L.   1877-8,  p.  983.      A  railroad   commis- 
sioner is  given  certain  police  powers,  also  power  to  determine  contro- 
versies between  railroads,  also  to  report  abuses,  L.  1877-8,  p.  969. 

Banks  may  be  formed  under  the  general  incorporating  act.  Stock 
books  to  be  kept  for  inspection  of  stockholders,  depositors  and  cred- 
itors." Notice  to  be  posted  for  general  public,  showing  names  of  directors 
and  the  value  of  their  shares,  §  32i.«  Banks  shall  publish  and  record 
verified  semi-annual  "  statements  of  banking  capital,"  and  "  statements 
of  banking  assets,"  Act  of  April  i,  1876,  Deering's  Civ.  C,  1885,  p.  81. 
A  heavy  penalty  is  provided  for  frauds  and  misrepresentations  by 
officers  of  banks,  Act  March  29,  1878,  Deering's  Civ.  C,  p.  82.  Trans- 
fer of  stock  by  indorsement  and  delivery  is  not  valid,  except  between 
parties,  until  duly  recorded  on  corporation  books,  Code,  §  324.''  Mar- 
ried women  may  hold  and  sell  stock  the  same  as  A/erne  sole,  Id.  §  325.* 
Transfers  by  non-residents  may  be  refused  registry,  until  affidavit  given 
of  transferrer  being  alive  at  time  of  transfer,  or  bond  being  given  against 

'  See  Cook  on  Stock  and  Stockholders  and"  General  Corporation  Law, 


» Id.,  chapter  xvii,  §  283. 

*  Id.,  chapter  XXX. 

*  Id.,  chapter  xiv. 


chapter  xli. 
*/</.,  chapter  xxxviii. 
'A/.,  chapter  xxx. 


*Id.,  chapter  Ixi. 

^  Id.,  chapters  xxii,  xxvii. 


10 

^ra).  Mode  of 
bed  by  statute. 
»roxy,  qualifica- 

roads.      Trans- 
lor  if  less  than 
transfer  is  ap- 
notes  or  bonds, 
property,  or  se- 
on-resident~per- 
provide  sinking 
sion  into  stock 
by  a  two-thirds 
rifled  certificate 
s  after  payment 
struction  within 
ar  thereafter,  or 
within  the  state 
;ering's  Civ.  C, 
nsent  of    three- 
sxcept  to  speci- 
lilroad   commis- 
termihe  contro- 
7-8,  p.  969. 
ting  act.    Stock 
iitors  and  cred- 
imes  of  directors 
ilish  and  record 
and  "  statements 
,  C,  1885,  p.  81. 
)resentations   by 
:.,  p.  82.    Trans- 
except  between 
e,  §  324.''  *  Mar- 
e  sole,  Id.  §  325.* 
til  affidavit  given 
ing  given  against 

-potation  Law, 

ihapter  Ixi. 
:hapters  xxii,  xxvii. 


11 


CALIFORNIA. 


§    3 


liability  for  registering.  Id.  §  326.  Contracts  relieving  directors  from 
liability  are  void.  Id.  §  327.  Must  organize  and  commence  business 
within  one  year  or  corporate  powers  cease,  §  358.^  All  fictitious  increase 
of  stock  or  indebtedness  is  void.*  Subject  to  this  provision  the  capital 
stock  may  be  increased  or  diminished,  or  the  bonded  indebtedness  in- 
creased by  a  two-thirds  stock  vote  at  a  meeting  duly  noticed,  §  359.  May 
only  hold  necessary  real  estate,  §  360,  and  note  containing  Act,  April  i, 
1876.*  Mining  corporations  may  consolidate,  §  361.  Articles  of  incor- 
poration may  be  amended  by  majority  of  directors  and  two-thirds  of 
stock,  §  362.  Complete  records  of  all  transactions  shall  always  be 
open  for  inspection  of  stockholders  and  creditors,  §  377.^  So,  also, 
a  "  stock  and  transfer  book,"  §  378.  State  authorities  may  examine 
into  corporate  affairs  at  any  time,  §§  382,  383.  Franchises  may  be  sold 
under  execution,  purchaser  to  continue  business,  and  redemption  is 
provided  for,  §§  388-393.  Foreign  corporations  shall  file  designation  of 
an  agent  within  state  upon  whom  process  may  be  served,  Act  April  i, 
1872,  Deering's  Civ.  C,  1885,  p.  102.' 

Savings  banks  may  only  loan  on  adequate  security  and  not  for  longer 
time  than  six  years,  §  571.  No  dividends  shall  be  made  except  from  sur- 
plus profits.  Directors  must  not  contract  any  debt  except  for  deposits. 
Depositors  have  priority  of  security  over  stockholders,  §  573.  May 
own  builduig  costing  $100,000,  and  by  vote  of  two-thirds  of  stockholders, 
may  increase  cost  to  $250,000.  Unless  the  capital  stock  or  reserve 
amounts  to  $300,000  no  savings  bank  can  hold  any  securities  other  than 
those  of  the  United  States,  this  state,  or  municipalities  of  this  state,  §  574. 
No  director  or  officer  mav  borrow  money  or  be  surety  for  money  bor- 
rowed from  the  institution,  §  578.  An  act  of  February  18,  1874,  author- 
izes next  of  kin  of  deceased  depositor  to  collect  the  deposit  when  it  does 
not  exceed  $300.     Deering's  Civ.  C,  p.  146. 

By  the  act  of  March  21,  1872,  it  is  provided  that  on  averified  petition 
of  a  majority  of  shareholders  in  a  mining  company,  a  county  judge  may 
call  a  meeting  for  removal  of  corporate  officers,  Deering's  Civ.  C, 
1885,  pp.  147,  148.  By  act  of  March  30.  1874,  careful  provision  is 
made  for  protection  of  stockholders  in  mining  corporations  by  means 
of  book  inspection,  balance  sheet,  etc.,  Deering's  Civ.  Code,  p.  148.  A 
farther  act  of  April  23,  1880,  provides  that  mining  directors  shall  not 
buy  or  sell  property  without  the  consent  of  two-thirds  of  stock.  Stock 
books  shall  not  be  closed  more  than  two  days  prior  to  elections,  Deer- 
ing's Civ.  C,  p.  149. 

'  See  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law, 

chapter  xxxviii. 
*  /</.,  chapter  iii,  §§  26-28.  */</.,  chapter  xli.  */d.,  chapter  xxx. 

*/(/.,  chapter  xli. 


■      i- 


A 


mi 

,  j 

14 


COLORADO. 


12 


Special  provisions  apply  to  insurance  corporations,  g§  414-452.  Street 
railroads,  gg  497-511.  Wagon-roads,  J(g  512-523.  Bridge,  ferry,  wharf, 
chute  and  pier  corporations,  §§  528-531.  Telegraph  companies,  gg  536- 
541.  Water  and  canal  companies,  gg  548-552,  and  notes.  Homestead 
corporations,  gg  557-566.  Land  and  building  corporations,  gg  639-648. 
Gas  companies  must  obtain  permission  of  local  authorities  to  lay  pipes, 
and  must  use  meters  approved  and  sealed  by  local  inspectors,  g  628. 

Tftxatlon.' — Corporate  property  is  assessed  where  it  lies,  ch.  40,  Laws 
1883  (Code  g  3641).  Taxation  of  railways,  g  3665,  ch.  237,  L.  1889. 
See  also  constitutional  provisions,  supra.  The  statutes  declare  that 
shares  of  stock  in  cofporations  possess  no  intrinsic  value  over  and  above 
the  actual  value  of  the  property  of  the  corporation  which  they  stand 
for  and  represent,  and  the  assessment  and  taxation  of  such  shares  and 
also  of  the  corporate  property  would  be  double  taxalidii.  Therefore, 
all  propert;y  belonging  to  corporations  shall  be  assessed  and  taxed, 
but  no  assessment  shall  l.e  made  of  shares  of  stock,  nor  shall  any 
holder  thereof  be  taxed  therefor,  Id.  g  3608.  A  tax  of  ten  cents  is  levied 
on  every  issue  of  a  certificate  of  stock,  whether  issued  originally  or 
by  transfer,  Act  of  April  t,  1878,  p.  87,  Deering's  Civ.  Code,  1885. 

g  4.  COLORADO.  Constitutional  ProTisions.— No  law  "  making  any 
irrevocable  grant  of  special  privileges,  franchises  or  immunities  shall 
be  passed  by  the  general  assembly,''  Art.  II.,  g  11.  ITie  general 
assembly  shall  not  pass  local  or  special  acts  "  granting  to  any  corpora- 
tion *  *  the  right  to  lay  down  railroad  tracks,  granting  to  any  cor- 
poration *  *  any  special  or  exclusive  privilege,  immunity  or  fran- 
chise whatever,"  Art.  V.,  g  25.  General  assembly  shall  not  authorize 
executors,  administrators,  guardians  or  other  trustees  to  invest  trust 
funds  in  bonds  or  stock  of  any  private  corporation,  Id.  g  36.  The 
power  to  tax  corporations  and  corporate  property,  real  and  personal, 
shall  never  be  relinquished  or  suspended.  Art.  X.,  g  9^  Corpora- 
tions of  the  state,  or  doing  business  therein,  shall  be  subject  to  taxation 
for  state,  county,  school,  municipal  and  other  purposes,  on  real  and 
personal  property  used  by  them  *•  within  the  territorial  limits  of  the 
authority  levying  the  tax,"  Id.  g  10.  State,  counties,  cities,  towns, 
townships  and  school  districts  forbidden  to  aid  or  subscribe  to  any  cor- 
porations. Art.  XI.,  gg  I,  2.  "No  railroad  corporation,  or  the  lessees 
or  managers  thereof,  shall  consolidate  its  stock,  property  or  franchises 
with  any  other  railroad  corporation  owning  or  having  under  its  control  a 
parallel  or  competing  line,"  Art.  XV.,  g  5.  Fictitious  stock  shall  be 
void.  Id.  g  9.     A   lease,   sale,  etc.,  to  foreign  corporations  shall   not 

'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxiv. 


19 

4 1 4-45 '•  Street 
ge,  ferry,  wharf, 
ipanies,  gg  536- 
es.  Homestead 
>ns,  §g  639-648. 
ies  to  lay  pipes, 
ctort,  §  628. 
es,  ch.  40,  Laws 
237,  L.  1889. 
tes  declare  that 
over  and  above 
rhich  they  stand 
such  shares  and 
inn.  Therefore, 
ised  and  taxed, 
:,  nor  shall  any 
:n  cents  is  levied 
ed  originally  or 
Code,  1885. 

iw  "  making  any 
immunities  shall 
I.  The  general 
J  to  any  corpora- 
nting  to  any  cor- 
munity  or  fran- 
ill  not  authorize 
s  to  invest  trust 
Id.  §  36.  The 
al  and  personal, 
§  9*  Corpora- 
ibject  to  taxation 
>es,  on  real  and 
rial  limits  of  the 
ss,  cities,  towns, 
cribe  to  any  cor- 
on,  or  the  lessees 
irty  or  franchises 
ider  its  control  a 
IS  stock  shall  be 
'ations  shall   not 

iw,  chapter  xxxiv. 


18 


COLORADO. 


8  4 


affect  power  of  the  state  over  the  projierty  and  franchises  of  the  old  cor- 
poration, Id.  §  14. 

MlHcelUneoiis  Corporations.— May  incorjwrate  for  any  lawful  purpose 
Gen.  Stat.  1883,  No.  237.  If  for  purpose  of  carrying  a  part  of  its  busi- 
ness beyond  the  state,  certificate  is  to  so  state.  No.  238.  May  buy  and  sell 
such  real  estate  as  is  necessary  to  business  and  may  mortgage  its  fran- 
chises and  property,  No.  240.  Directors  must  be  stockholders,  No.  242. 
Shall  not  purchase  its  own  stock  '  r  stock  in  other  corporations.  No.  246, 
Stockholders  may  be  garnisheeu  for  un|)aid  subscriptions,  No.  247. 
Stockholders,  except  in  railroad  and  telegraph  companies,  may  examine 
all  the  books,  etc.,  of  the  company.  No.  249.  Directors  must  make  an 
annual  report.  No.  252.  Meetings  of  directors  may  beheld  out  of  state, 
only  when  articles  of  incorporation  so  state  or  their  acts  are  ratified  by 
majority  of  the  stockholders,  No.  254.  Stockholders'  liability  may  be 
enforced  in  equity  by  corporate  creditors,  No.  258.  At  elections  each 
share  has  one  vote.  No.  242.  Stockholders  may  make  by-laws,  or  direc- 
tors may  if  certificate  so  provides.  No.  245.  Certificate  of  stock  fully 
paid  in  to  be  filed  in  county  and  state,  No.  248.  Stock  may  issue  for 
property.  No.  251.  Domestic  corporations  may  accept  and  operate  under 
law  of  another  state  or  country.  No.  259.  Foreign  corporations  must  file 
certificate,  and  be  subject  to  liabilities,  duties  and  restrictions  of  domestic 
corporations.  Power  to  mortgage  limited.  No.  260.  Foreign  cor|X)rations 
must  file  copy  of  charter,  No.  261.  Failure  to  comply  with  g§  260,  261, 
supra,  renders  officers,  agents  and  stockholders  so  offending  jointly  and 
severally  liable.  No.  262.  No  company  under  this  act  can  construct  a 
street  railroad  without  consent  of  local  authorities.  No.  266.  Verified  state- 
ment of  affairs  must  be  made  upon  written  request  of  fifteen  per  cent,  of 
stock.  No.  268.  Unrecorded  transferers  liable  on  un  uibscriptions. 
No.  269.  One-third  of  stock  may  demand  call  of  nn  .ig  to  consider 
amendments  which  may  be  adopted  by  two-thirds  stock  vote,  L.  1885,  P- 
151.  Shares  of  stock  subject  to  execution  and  levy,  §§  1876,  1882.  Cer- 
tificate of  incorporation  of  mining  companies  shall  state  whether  stock  is 
assessable  or  unassessable  and  each  certificate  of  stock  shall  plainly  show, 
No.  320.  Consolidations  authorized.  Gen.  Stat.  No.  375.  After  par 
value  of  stock  is  paid,  part  having  been  issued  as  full  paid  in  payment 
of  property,  the  stock  shall  be  equally  and  ratably  liable  to  assessment 
for  the  operations  of  the  company.  No.  321.  Assessments  to  be  laid 
only  by  majority  vote  of  all  the  stock.  No.  322. 

Bailroads. — Are  subject  to  above.  Consolidations  authorized  upon  a 
three-fourths  vote  of  all  the  stock  of  each  corporation,  No.  349.  May 
consolidate  with  connecting  foreign  railroad  corporation  upon  concurrence 
of  majority  of  stock,  No.  353,  354.    Lease  of  railroad  authorized  on  two- 


!■! 


) , 

I/. 


\ 


1 


M 


COLORADO. 


14 


thirds  stock  vote,  No.  360,  361.  Railroad  corporations  may  l)e  formed 
to  own  railroad  purcliased  at  foreclosure  sale,  and  may  have  all  the  powers 
of  the  old  corporation,  Act  of  April  7,  1885.  May  amend  charter  by 
two-thirds  stock  vote,  No.  363.  Five  may  incorporate,  No.  333.  Majority 
of  stock  to  fix  loans  and  interest.  And  may  mortgage  property  md  fran- 
chises, No.  335, 336.  Must  begin  construction  within  two  years  and  ex- 
pend twenty  per  cent,  within  five  years  or  powers  cease,  No.  339,  cp.  L. 
1889,  p.  95.  Fictitious  stocks  and  bonds  are  void,  No.  340.  Consolidation 
■with  foreign  company  does  not  form  a  foreign  corporation  nor  remove  it 
from  state  jurisdiction.  No.  358.  Where  election  of  directors  has  not  been 
held,  as  legally  appointed,  any  two  stockholders  may  notice  a  meeting 
•under  the  statute  for  that  purpose,  L.  1885,  p.  149.  Purchasers  of  rail- 
road at  judicial  sale  to  be  a  corporation,  L.  1885,  p.  150.  Liens  of 
mechanics  and  material  men  include  franchises  and  charter  privileges,  L. 
1883,  pp.  225,  228.  An  act  of  March  12, 1883,  enables  counties  to  refund 
railroad  aid  bonds  issued  under  former  acts,  L.  1883,  pp.  142-145. 
Any  railroad  may  guarantee  payment  of  mortgages,  bonds,  etc.,  of  con- 
necting railroads,  or  guarantee  to  such  road  payment  of  interest  upon 
its  capital    stock,   L.   1887,  p.  369. 

Banks.— Are  subject  to  above.  Capital  stock  to  be  $30,000  or  over, 
No.  271.  Fifty  per  cent,  capital  must  be  paid  in  and  certified  before 
organization  and  the  entire  amount  within  one  year.  May  not  loan  on 
security  of  own  stock  or  require  less  from  shareholders  than  from 
others.  May  not  purchase  or  hold  its  own  or  other  shares  except  to 
secure  debts  previously  contracted,  No.  271.  Stockholder  not  to  vote  if 
he  owes  bank  on  past  due  debt,  No.  273.  Corporation  has  lien  on  stock, 
No.  274.  Stockholders  liable  on  stock  to  extent  of  its  par  value,  in  ad- 
dition to  subscription,  such  liability  to  cease  one  year  after  due  transfer, 
No.  279.  Semi-annual  verified  statement  to  be  made  to  state  treasurer, 
and  published,  No.  277.  Upon  failure  to  do  which  the  directors  are  per- 
sonally liable,  No.  278.  Collective  liability  of  stockholders  to  bank  not  to 
€xceed  two-fifths  capital  stock  paid  in  and  undiminished,  No.  280. 
Savings  banks  may  be  formed  with  capital  not  less  than  $25,000,  which 
must  be  paid  in  cash,  No.  281.  Quarterly  statements  to  be  made,  No. 
285.  Twenty  per  cent  of  deposits  must  be  kept.  No  dividends  until 
depositors  are  paid,  No.  287.  No  loans  or  discounts  to  officers.  No.  291. 
Shareholders  in  banks,  trust,  security,  etc.,  associations  are  individually 
liable  in  double  the  amount  of  the  par  value  of  stock  owned  by  them, 
L.  1885,  p.  264.1  Deemed  larceny  for  bank  officer  to  accept  deposit 
after  knowledge  of  insolvency,  L.  1885,  p.  50.  Such  officer  also  liable 
for  loss.  Id.  p.  51.  No  1  ank  under  state  law  to  loan  funds  in  excess 
of  twenty-five  percent  of  its  capital  stock,  L.  1885,  p.  51. 

'  Cook  on  Stock  and  Stockholders,  and  General  Corporation  Law,  chapter  xil. 


rw 


m 


u 

.  may  be  formed 
ve  all  the  powers 
lend  charter  by 
o.  333.  Majority 
operty  md  fran- 
vo  years  and  ex- 
,  No.  339,  c/>.  L. 
0.  Consolidation 
on  nor  remove  it 
tors  has  not  been 
lotice  a  meeting 
irchasers  of  rail- 
150.  Liens  of 
ter  privileges,  L. 
)unties  to  refund 

5,  pp.  142-145. 
ids,  etc.,  of  con- 
Df  interest  upon 

,0,000  or  over, 
I  certified  before 
May  not  loan  on 
Iders  than  from 
shares  except  to 
der  not  to  vote  if 
las  lien  on  stock, 
>  par  value,  in  ad- 
fter  due  transfer, 
1  state  treasurer, 
directors  are  per- 
ers  to  bank  not  to 
lished.  No,  280. 
n  $25,000,  which 
to  be  made,  No. 
o  dividends  until 
officers.  No.  291. 
!  are  individually 
;  owned  by  them, 
to  accept  deposit 
ifficer  also  liable 
funds  in  excess 

Law,  chapter  xii. 


16 


CONNECTICUT. 


8  5 


\ 


Taxation. — A  fee  of  $10.00  is  to  be  paid  to  the  secretary  of  state 
for  filing  the  articles  of  incorporation,  if  the  capital  stock  is  $100,000 
or  less.  If  over  $100,000  an  additional  fee  of  ten  cents  for  every 
41.000,  L.  1885,  p.  153.  Bank  stock  and  stock  in  moneyed  corpo- 
rations shall  be  taxed  for  state,  county  and  municipal  pur|)oses.  Gen. 
Stat.  1883,  ^  2829,  Railroad  realty  is  to  be  taxed  where  it  lies.  All 
other  railroad  pro|)erty  is  assessed  by  state  assessors,  and  each  muni- 
cipality is  notified  of  its  proper  proportion  of  such  amount,  to  be 
assessed  by  the  municipality  through  which  the  road  runs,  ^  2847. 
National  bank  stockholders  are  taxed  where  the  bank  is  located  and  its 
realty  is  also  taxed,  \^  2849.  Shares  of  stock  in  all  corporations  are 
taxed,  g  2838.  Stock  in  domestic  corporations  may  be  sold  for  non- 
payment of  tax,  §  2891. 

§  5.     CONNECTICUT.— Constitutional  Provisions.—"  No  man  or  set 

of  men  are  entitled  to  exclusive  public  emoluments  or  privileges  from 
the  community,"  Art.  I.  Municipalities  shall  not  subscribe  to  the 
stock,  or  buy  the  bonds  of,  or  lend  aid  to  railroad  corporations.  Art. 
XXIV.  of  Amendments. 

Miscellaneous  Corporations.— Three  or  more  may  incorporate  for  any 
lawful  purpose,  hereunder,  except  for  trust,  insurance,  buymg  and 
selling  real  estate,  banking,  issuing  or  trading  in  bonds,  notes  or  other 
evidences  of  indebtedness,  or  trafficking  in  letters  patent  or  patent 
rights.  May  also  incorporate  to  carry  on  same  business  out  of  the  state, 
but  in  such  a  case  the  secretary,  treasurer  and  majority  of  directors 
must  be  residents  of  Connecticut,  Gen.  Stat.  1888,  g  1944.  There  is  no 
limitation  as  to  the  capital  stock.  The  directors  must  be  stock- 
holders, §  1946.1  Cannot  commence  business  until  whole  capital 
stock  is  subscribed  and  20  per  cent  thereof  paid  in  cash,  §  1947. 
This  provision  was  added  in  1880  to  the  old  act  because  during 
1878  and  1879  over  one  hundred  corporations  were  formed,  having  a 
capital  stock  aggregating  over  $40,000,000  all  paid  up  by  "  patents  "  or 
*' mining  claims,"  and  not  a  single  stockholder  a  resident  of  Con- 
necticut. The  articles  of  association  must  be  published  and  filed  with 
secretary  of  state,  §  1948."  Objects  of  corporation  may  be  changed 
upon  consent  of  holders  of  two-thirds  of  stock  and  execution 
of  amended  articles,  §1951.  "The  statements  and  books  of  every 
such  corporation  shall  be  kept  in  the  town  where  it  is  located  and 
shall  at  all  reasonable  times  be  open  for  the  inspection  of  any  of 
its  stockholders,  and  as  often  as   once   in    each  year  a   true  statement 

'  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,   chapter  xxxvii. 

'  /</.,  chapter  xiii. 


«  5 


CONNECTICUT. 


1« 


of  the  account  shall  be  matle  and  exhihited  to  the  stockholders," 
15  1953.'  Capital  may  l)e  increased  or  diminished  upon  two-thirds  stock 
vote  and  compliance  with  all  formalities  as  to  original  article, 
^  1954.  In  case  of  increase,  20  |ier  cent  of  amount  ailded  must  be 
paid  in,  g  1955,  1-  1889,  chapter  64.  I'he  treasurer  shall  make  an 
annual  report,  g  1956,  L.  1889,  Ch.  65.  Under  |)enalty  for  failure  so  to  do, 
(len.  Stat.  ^  1959.  Corjwration  has  a  lien  «)n  stock  for  the  stockholder's 
debts  to  it,  ^  J960.''  Kquity  in  stock  pledged  may  be  sold  by 
company,  ^  1963.  Investment  companies  issuing  debentures  l>ased 
on  mortgages,  etc.,  are  taxed,  regulated,  and  required  to  take  out  a 
license;  so  also  must  an  investment  broker,  L.  1889,  ch.  248. 

Railroads. — Not  less  than  twenty-five  persons  may  incorporate, 
§  3433-  ^'  '"^y  ^''ve  not  less  than  nine  directors.^  a  majority  of  whom 
are  to  be  residents.*  The  capital  stock  must  be  not  less  than  ten  thou- 
sand dollars  a  mile.  'I'otal  debt  never  to  exceed  paid-in  capital,* 
&"3434'  ^'ve  thousand  dollars  a  mile  is  to  be  subscribed,  and  ten  per 
cent,  paid  in  cash  be/ore  incorporation.  The  officers'  affidavits,  and 
sworn  report  of  engineer  must  be  filed,  ^3436.  Not  to  commence  work 
until  ten  thousand  dollars  a  mile  is  subscribed,  §  3437.  Charter  ceases 
unless  work  is  begun,  and  ten  per  cent  expended  within  two  years  (which 
may  be  extended  to  four  years)  and  road  put  m  operation  within  five  years, 
§  3440.*  No  other  railroad  shall  take  stock  in  a  company  formed 
under  thi?  act,  unless  specially  authorized  by  general  assembly,  Id. 
8  3442.  Non-competing  railroads  meeting  at  state  line  may  consoli- 
date, if  outstanding  bonds  do  not  exceed  one-half  the  amount  actually  ex- 
pended upon  such  roads,  g  3443.  No  evidences  of  debt  shall  be  issued 
in  consideration  of,  or  in  connection  with  such  consolidation,  §3444, 
Consolidation  agreement  must  be  ratified  by  a  two-thirds  stock  vote. 
Id.  §  3445.  Such  consolidated  company  may  mortgage  entire  road  to 
secure  bonds  and  provide  therein  for  foreclosure  sale  of  all  property  in 
both  states  by  decree  of  competent  court  of  this  state,  Id.  g  3447- 
Such  consolidated  company  may  sue  and  be  sued  in  any  county  in  this 
state  cut  by  its  line,  and  at  least  six  directors  shall  be  citizens  of  this 
state.  Id.  §  3449.  Railroad  company  may  prohibit  officers  from  voting 
proxies  for  stock  not  their  own,  Id.  §  3457.  Stockholders  in  arrears 
are  not  to  be  allowed  to  vote,  §  3458.  Every  railroad  before  applying 
to  railroad  commissioners  for  their  approval  of  the  location,  shall  de- 
posit eleven  dollars  per  mile  of  proposed  road,  Id.  §  3459.  "No  railroad 
shall  lay  out  and  finally  locate  its  road,  without  the  written  approbation 

'See  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxx. 
'/</.,  chapter  xxxi.  */</.,  chapter  xxxvi,  §  592.  */</.,  chapter  xxxvii. 

»/(/.,  chapter  xli.  '/</.,  chapter  xxxviii. 


stockholilera," 
wo-thirils  stock 
riij;inal  article, 
added  nuiiit  be 
hhull  make  an 
failure  HO  to  do, 
le  stockholder'* 
ay  be  sold  by 
bentures  l>ased 
to  take  out  a 
.  348. 

jy  incorporate, 
ijority  of  whom 
than  ten  thou- 
»aid-in  capital,* 
)ed,  and  ten  per 
affidavits,  and 
commence  work 
Charter  ceasea 
vo  years  (which 
vithin  five  years, 
jnipany  formed 
d  assembly,  Id. 
2  may  consoli- 
lunt  actually  ex- 
i  shall  be  issued 
idation,  ^3444. 
irds  stock  vote, 
e  entire  road  to 
f  all  property  in 
tale,  Id.  8  3447. 
y  county  in  this 
;  citizens  of  this 
:ers  from  voting 
ders  in  arrears 
jefore  applying 
:ation,  shall  de- 
"  No  railroad 
en  approbation 

Law,  chapter  xxx. 
/.,  chapter  xxxvii. 


IT 


CONNKCTICUT. 


«  5 


of  the  location"  by  the  railroad  commissioners,  {(3460.  "Any  railroad 
company  may  make  lawful  contracts  with  any  other  railroad  company, 
with  whose  railway  its  track  may  council  t^r  intersect,  in  relation  to  its  busU 
nessor  property,  anil  may  take  a  lease  of  the  property  or  franchise  of,  or 
lease  its  property  or  franchises  to,  any  such  railway  company,' 
§  3472.  A  lease  to  be  binding  more  than  one  year  must  be  approved  by  a 
two-thirds  stock  vote.  Id.  §  3473.  May  borrow  money  or  give  bonds  se- 
cured by  mortgage,  {|{S  3570,  357'.  A  railroad  may  be  taken  posses- 
sion of  by  a  trustee  for  the  bondholders,  j}  3573.  The  trustee  may  also 
foreclose,  83576.  A  board  of  railroad  commissioners  are  given  various 
police  jMJwers,  §g  3433-3441,  3460-3500.  Railroads  shall  not  issue 
free  tickets  to  members  of  the  legislature,  but  upon  request  the 
comptroller  of  the  state  shall  purchase  tickets  for  such  members,  and 
pay  for  them  from  the  moneys  of  the  stale,  L.  1889,  ch.  198.  All  guar- 
antees by  a  railroad  of  bonds  and  stock  of  another  corporation,  must  l)e 
registered  in  the  comptroller's  office.  A  railroad  whose  own  bonds,  to- 
gether with  guaranteed  bonds,  are  equal  to  one-half  its  actual  cost  of 
construction,  shall  make  no  further  guarantee.  No  guarantee  of  bonds 
and  stock  shall  exceed  one-half  of  the  actual  cost  of  the  guaranteeing 
company,  L,  1889,  ch.  318. 

State  banks  and  trust  companies,  §§  1761-1788.  National  banks, 
§g  i789-i798.^^Savings  banks,  gg  1 799-1834.  Bank  commissioners, 
gg  1825-1833. 

tieneral  Prorlsions. — Name  must  indicate  that  it  is  a  corporation, 
Gen.  St.,  1888,  g  1905.  May  hold  real  estate  for  its  purposes  not  ex- 
ceeding charter  limit.  Id.  g  1906. '  All  charters  subject  to  legislative 
alteration  and  repeal,  Id.  g  1909.  Charter  void  unless  sworn  certificate 
of  organization  is  filed  with  secretary  of  state  within  two  years  from 
approval  of  charter,  Id.  g  1910.  Legislative  amendments  not  opera- 
tive unless  corporate  acceptance  is  filed  within  six  months.  Id.  g  191 1. 
Upon  failure  to  hold  annual  meeting,  a  special  meeting  for  election 
may  be  ordered  ui-jn  the  written  request  of  "not  less  than  ten,  or 
a  majority  of  the  meinbers,"  Id.  g  1919.  Stock  is  personal  property, 
transferable  only  on  books,  and  corporation  has  lien  on  all  shares  for 
all  dues  from  holder,  Id.  g  1933.''  Pledge  of  stbck  does  not  bind  third 
parties  unless  actually  transferred,  or  power  of  attorney  filed  with  cor- 
poration, Id.  g  1934.'  Each  share  has  one  vote,  Id.  g  1936.  Proxies 
in  banks  and  railroads  good  for  only  one  year,  Id.  gi927.  Taxes  im- 
posed by  corporation  upon  its  shares  may  be  collected  by  levy  of  exe- 
cution under  warrant  of  justice  of  peace.  Id.  g  1930.     No  annual  divi- 

'See  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xli. 
/</,,  chapter  xxxi.  */d.,  chapter  xxvi. 


4 


I 

I  ! 


:'} 


CONNECTICUT. 


18 


dend  shall  exceed  lo  per  cent  until  surplus  equals  20  per  cent,  Id.  § 
1931,  Impaired  capital  stock  and  par  value  of  shares  may  be  reduced 
by  vote  of  stockholders  approved  by  two-thirds  of  board,  Id.  §  1933. 
Corporations  are  authorized  to  divide  a  portion  of  their  profits  among 
employes,  Id.,  §§  1935,  ^93^-  Corporations  not  required  to  report  to 
state  officer  shall  make  annual  detailed  sworn  return  to  to\.'n  clerk, 
Id.  §  1937.  Intentional  neglect  or  refusal  to  comply  with  laat  section 
makes  the  corporate  officers  individually  liable.  Id.  1938.  Attorneys, 
creditors,  etc.,  of  stockholders  are  entitled  to  information  from  stock 
book  at  all  times.  Id.  §  193).'  Any  stockholder  of  a  corporation  may 
apply  for  a  writ  of  mandamus  against  it,  to  compel  it  to  obey  the  statute 
laws  of  the  state,  §  1296.  Stock  dividends  shall  go  to  the  remainderman, 
L.  1889,  ch.  72.  No  injunction  against  voting  to  be  granted  within  ten 
days  prior  to  a  meeting,  except  from  voting  on  matters  other  than  the 
organization  and  adjournment  of  the  meeting,  L.  1889,  ch.  39. 
"  Taxation.^ — The  whole  properly  of  every  corporation  in  the  state 
whose  property  is  not  by  law  expressly  exempt  from  taxation  or  which 
does  not  pay  direct  state  tax  in  lieu  of  all  other  taxes,  except  such  real 
estate  as  may  be  required  for  the  transaction  of  its  appropriate  business, 
shall  be  set  in  its  list  and  liable  to  taxation  in  the  same  manner  as  the  prop- 
erty of  individuals.  Gen.  Stat.  1888,  §§  3832,  3833.  The  real  estate  is 
taxed  where  it  is  located;  the  personalty  at  the  principal  place  of  busi- 
ness. "  The  stockholders  of  any  corporation,  the  whole  property  of  which 
is  assessed  and  taxed  in  its  name,  shall  be  exempt  from  assessment  or 
taxation  for  their  stock  therein,"  Id.  §  3834.  The  shares  of  the  capi- 
tal stock  of  any  bank,  national  bankii  issociation,  trust,  insurance, 
turnpike,  bridge  or  plank  road  company,  owned  by  residents  are  taxed 
in  the  town  where  the  stockholder  resides.  A  deduction  is  allowed  for 
the  tax  on  the  corporate  realty,  Id.  §  3836.  The  secretaries  or  cashiers 
must  send  to  the  town  assessors  the  names  of  stockholders  residing 
therein,  the  number  of  shares  owned  and  their  market  value,  Id.  §§ 
3837-3838.  Transfers  to  avoid  the  tax  have  a  penalty  attached  of  one  per 
cent  of  the  value  of  the  stock,  Id.  §  3839.  The  same  penalty  is  in- 
curred by  a  stockholder  who  returns  an  untrue  residence,  Id.  §  3840. 
A  tax  of  one  per  cent  of  the  market  value  is  imposed  on  shares  owned 
by  non-resident  stockholders  "whose  stock  is  liable  to  taxation  and  not 
otherwise  taxed,"  Id.  §  3916.  The  corporation  pays  it  and  has  a  lien 
therefor.  Id.  §3917.  Railroad  corporations  pay  a  tax  of  one  per  cent 
on  the  market  value  of  their  stock,  bonds,  and  funded  and  floating  debt, 
deducting  corporate  obligations  held  in  ^trust  as  sinking  fund.     A  de- 

'See  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxx. 

'  /(/.,  chapter  xxxiv. 


-.J.j.JJiU..i., 


18 

5  per  cent,  Id.  § 
may  be  reduced 
)ard,  Id.  §  1933. 
;ir  profits  arrong 
ired  to  report  to 
11  to  to\.'n  clerk, 
with  last  section 
938.  Attorneys, 
ation  from  stock 
corporation  may 
:o  obey  the  statute 
he  remainderman, 
jranted  within  ten 
irs  other  than  the 
h  ch.  39. 

ition  in  the  state 
taxation  or  which 
1,  except  such  real 
propriate  business, 
nanner  as  the  prop- 
The  real  estate  is 
pal  place  of  busi- 
2  property  of  which 
rom  assessment  or 
hares  of  the  capi- 
,  trust,  insurance, 
residents  are  taxed 
;tion  is  allowed  for 
retaries  or  cashiers 
)ckholders  residing 
rket  value,    Id.  §§ 
attached  of  one  per 
ime  penalty  is  in- 
jence,   Id.  §  3840. 
d  on  shares  owned 
to  taxation  and  not 
rs  it  and  has  a  lien 
IX  of  one  per  cent 
:d  and  floating  debt, 
iking  fund.     A  de- 
ion  Law,  chapter  xxx. 


19 


DELAWARE, 


§  6 


'duction  is  made  for  taxes  paid  on  the  corporate. realty.     No  other  tax 
is  levied  on  the  franchise,  property  or  debts.  Id.  §§  3919,  3920.     If  the 
railroad  is  partly  out  of  the  state  only  a  proportion  of  such   tax  is 
levied,  Id.  §  3921.     A  deduction  is  made  for  value  of  foreign  railroads 
leased  by  the  domestic  corporations.    Id.  §  3923.      The  valuation  of 
bonds   and    debts     is   to  be  no   more  than  par,  but  is  to  be  less    if 
market  value  is  less.  Id,  §  3991.    As  to  how  market  value  is  determined, 
see  Id,  §3931.     Express  companies  pay  two  per  cent  on  gross  amount 
of  all  express  charges  paid  within  state;   or,  in  lieu  thereof,  may  pay 
$10,000,  Id.  §  3928,     A  like  provision  applies  tr  telephone  and  tele- 
graph companies.  Id.  §  3929.     Special   provisions  are  made  for  taxing 
different  kinds  of  insurance  companies.    Id.  §§  3933-3942.     Bonds  of 
foreign  railroads  owned  by  residents  of  this  state  are  taxed.  Id.  §  3830. 
Savings  banks  are  taxed  one-fourth  of  one  per  c«nt  on  deposits  exclusive 
of  surplus,  deducting,  however,  $50,000  and  investments  in  exempted 
public  securities  and  also  taxed  real  estate.  Id.  §3918.      Every  joint 
stock  company  pays  $1.00    for    recording  every  certificate   required, 
§  1968.     No  application  will  be  entertained  for  charter  for  company 
to  have  its  principal  business  without  the  state  until  fee  of  $100  is 
paid,  Id.  §  1912.     And  before  commencing  business  such  corporation 
(supra  §  1912)  shall  pay  additional  fee  of  from  $100  to$5,ooo,as  deter- 
mined by   state  board,  Id.    §  1913.       And  the  last  named  provision 
applies  also  to  every  increase  of  capital  by  every  such  corporation. 
Id,  §  1914.     The  secretary  of  state  shall  issue  no  copies  of  charter  or 
organization  certificate  until  such  fees  are  paid.  Id.  §  1915.     Payments 
made  under  the  above  provisions  are  in  lierj  of  all  taxes  on  franchise, 
but  not  in  lieu  of  taxes  on  corporate  property  orshares  held  by  indi- 
viduals resident  in  this  state,  Id.  §  1916. 

In  taxing  stock  a  deduction  is  allowed  for  taxes  levied  on  the  real 
estate  of  the  corporation,  L.  1889,  ch.  63. 

A  special  tax  is  levied  upon  telegraph  and  telephone  companies,  L. 
1889,  ch.  178, 

Corporations  -having  special  charters  cannot  increase  the  capital 
stock  except  unon  paying  a  tax  which  is  to  be  fixed  by  the  state  board, 
L.  1889,  ch,  204. 

§  6.  DELAWARE.  Constitutional  ProTisions.— No  incorporating  act 
shall  be  enacted  except  by  the  concurrence  of  two-thirds  of  each  branch 
of  the  legislature.  Charter  shall  be  granted  for  twenty  years  only,  Art. 
2,  §  17.  An  amendment  was  ratified  in  1875,  authorizing  the  legislature 
to  enact  a  general  incorporation  act  for  religious,  charitable,  literary 
and  manufacturing  purposes,  for  the  preservation  of  animal  and 
vegetable  food,  building  and   loan  associations,  and   for  draining  low 


■!-{ 


"""■■■■■■^'■■■■■Ill 


8  6 


DELAWARE. 


30 


lands  ch.  i,  L.  1875.  Under  this  such  an  act  was  passed,  L.  i?:j, 
ch  119,  but  it  wa-j  repealed  and  another  substituted  by  ch.  147,  L. 
,883  A  substituted  constitutional  amendment  was  proposed  by  ch.  1, 
L.  1883,  which  should  extend  the  power  to  include  all  municipal  ard 
private  corporations  excepting  railroad  and  canal  companies. 

Manntactnrlng   Corporatlon8.-Three     or    more    may     incorporate. 
Charter  is  to  state  the  amount  of  personal  and  real  estate  it  may   hold. 
May  limit  the  powers  hi  stockholders  and   directors.     Majority  of  cor- 
porators must  be  residents.     Articles  signed  and  acknowledged  must  be 
published  and  presented  to  a  judge   for  his  approval.     He   may   use 
discretion  in  allowing  or  disallowing  the  application.     May  carry  on 
part  of  business  and   have  one  or  more  of  principal  offices  out  of  the 
state      Voting  power  of  stock   may  be  limited.     Pledges   shall  be  so 
mentioned  in  transfers  on   corporate  books.     Directors  are  liable   for 
corporate  debts,  if  they  do  not  file  certificate  that  capital  stock  is  paid  up 
when  such  is  the  fact.  Books  are  closed  for  elections  twenty  days  be  ore 
the  election.  Stock  list  open  to  stockholders'  inspection  ten  days  before 
election      Supreme  court  has  jurisdiction  to  consider  complaints  as  to 
elections.     Stockholders'  meetings  to  be  in  the  stal'^     Directors'  meet- 
ings   and  their  books,  except  stock  and  transfer  books,  may  be  out  of 
the  state      Loans  to  stockholders  are  prohibited.    Officers  are  liable  for 
all    corporate  debts,  in   case    they   make  false  certificates  or   public 
notices     Ten  per  cent  of  capital  must  be  paid  in  before  commencing 
business.  Articles  approved  by  judge  to  be  recorded  in  county  and  state. 
Legislature  may  at  pleasure  dissolve  any  corporation  under  this  act,  or 
alter  its  charter.     Sworn  certificate  to  be  made  and  filed  when  capital 
is  fully   paid  up.     Directors'  meetings  may  be  held  out  of  the  state  if 
the  by-laws  so  provide.     If  an  election  goes  over  and   is   held  later 
only  those  vote  who  were   entitled  to  vote  at  regular  time.     Judge  of 
court  may  summarily  order  such  election  upon  application  of  any  stock- 
holder     By-laws  regulating  elections  must  have  been  made  thirty  days 
before  election  in  order  to  affect  it.     Court  may  summarily  order  all 
books  to  be  brought  into  state  on  pain  of  forfeiture  of  charter.  Meetings 
other  than  legal   may  be  called  by   three   stockholders.     Stock  may 
be  issued  for  property.  Laborers  have  a  lien  for  one  month's  wages.  Time 
of  charter  (twenty  years),   may   be  extended     Corporation  may  bond 
its  real  and  personal  property,  not  exceeding  "the  amount  limited  m  its 
charter."      May  mortgage  property  and  franchise.     If  capital  stock 
is    not  all  paid  in,  stockholders  are  liable  to  corporate  c.editors   for 
the  deficiency,  ch.    i47»    Laws    1883. 

Railroads There  is  no  general  incorporating  act. 

Banks.— There  is  no  general  act.     Banking  without  incorporation  it 
declared  unlawful.  Rev.  Code  1874,  P-  3^^- 


20 

sed,    L.   i?:j, 

l)y  ch.  147,  L. 

losecl  by  ch.  i, 

nunicipal    ard 

s. 

'    incorporate. 

it  may  hold, 
ijority  of  cor- 
edged  must  be 

He   may   use 
May  carry  on 
[ices  out  of  the 
Bs   shall  be  so 
are   liable   for 
;tock  is  paid  up 
nty  days  before 
ten  days  before 
omplaints  as  to 
Directors'  meet- 
,  may  be  out  of 
rs  are  liable  for 
lates  or   public 
re  commencing 
)unty  and  state, 
ider  this  act,  or 
ed  when  capital 
it  of  the  state  if 
1   is   held  later 
ime.     Judge  of 
)n  of  any  stock- 
nade  thirty  days 
larily  order  all 
larter.  Meetings 
rs.     Stock   may 
h's  wages.  Time 
ition  may  bond 
unt  limited  in  its 
If  capital  stock 
te  c.editors  for 


incorporation  is 


21 


FLORIDA. 


if 


Taxation.— Corporations  transporting  passengers  by  steam  power  are 
taxed  ten  cents  for  every  passenger,  Code  1874,  p.  29.  But  instead 
thereof  they  may  pay  such  a  part  of  their  gross  receipts  from  passengers, 
as  1^13,000  is  part  of  the  gross  receipts  of  the  Philadelphia,  Wilmington 
and  Baltimore  Railroad  Company  from  passenger  traffic,  p.  31.  A  tax 
of  ten  per  cent  of  the  whole  net  earnings  or  income  of  railroad  and  canal 
companies  is  also  imposed,  p.  41.  ALso  a  specific  tax  on  each  loco- 
motive and  passenger  coach,  p.  42.  Also  a  tax  of  one-half  of  one  per 
cent  of  the  cash  value  of  all  the  shares  of  stock  of  the  capital  stock,  Id. 
Shares  of  stock  in  banks  are  taxed  one-quarter  of  one  per  cent,  p.  45. 
Shares  of  stock  in  both  domestic  and  foreign  corporations  are  taxed, 
p.  53.  Manufacturing  corporations  pay  also  a  tax  of  one-tenth  of  one 
per  cent  of  cost  value  of  products,  p.  56.  Several  special  £3ts  provide 
for  commutation  of  special  railroad  taxes,  supra.  Railroad  realty,  other 
than  the  right  of  way,  is  taxable  for  municipal  purposes,  ch.  241,  L.  1887. 
All  insurance  business  pays  two  and  a  half  per  cent  of  gross  pren>iums, 
ch.  423,  L.  1 88,1^. 

§  7.  FLORIDA.  Constltattonal  Provisions. — Neither  the  state  nor 
municipalities  shall  aid  or  subscribe  to  any  corporation.  Constitution  of 
1875,  Art.  IX.  §§  7,  10.  Corporate  property,  with  a  few  exceptions,  is 
to  be  subject  to  taxation.  Art.  XVI.  §  i6.  Free  passes  to  members  of 
the  Legislature  or  to  salaried  state  officers  are  prohibited.  Id.  §  31. 

Miseellaneons  Corporations. — Any  number  may  incorporate  for  any 
lawful  business,  Dig.  of  Fla.,  L.  1881,  p.  228.  Articles  of  incorporation 
are  to  be  filed  with  secretary  of  state,  and  in  county  where  business  is 
done  or  works  are  located.  Id.  May  hold  real  estate  for  purposes  of 
incorporation,  but  not  to  exceed  amount  limited  in  articles,  p.  228. 
May  increase  or  diminish  by  vote  of  stockholders  cast  as  by-laws  direct, 
the  number  of  trustees  or  directors  but  not  to  less  than  three,  p.  228. 
Capital  stock  may  be  increased  by  majority  stock  vote  and  a  report  of 
proceedings  to  secretary  of  state,  pp.  229,  230.  Justice  of  the  peace 
may  call  a  corporate  meeting  on  application  of  one-third  of  the  stock- 
holders in  interest,  p.  230.  Shares  not  transferable  until  previous  calls 
are  paid,  p.  231.  Corporations  may  sue  members  for  all  dues,  p.  231. 
Directors  individually  liable  for  declaring  illegal  dividends,  p. 
332.  If,  upon  dissolution,  corporate  debts  are  unpaid,  stockholders 
are  liable  to  the  extent  of  the  par  value  of  their  stock,  p.  232.  Transfer 
of  stock  to  avoid  taxation  forfeits  one-half  the  par  value  thereof,  p.  233. 
Stock  book,  containing  names  and  amount  of  stock  held  by  each,  to  be 
open  to  stockholders.  Id.  A  corporation  herein  is  entitled  to  "  exclusive 
privileges  for  tiie  purposes  of  its  creation  "  for  twenty  years  after  com- 


§7 


FLORIDA. 


98 


mencing  business,  p.  234.  Notice  of  the  formation  of  a  corporation, 
stating  also  tlie  highest  amount  of  indebtedness  it  may  incur,  must 
be  published  in  a  newspaper  for  four  weeks,  Id.  Charter  may  be 
amended.  Statement  of  capital  stock,  of  amount  paid  in,  and  of  in- 
debtedness, to  be  published  locally  every  six  months,  and  annually  at 
capital.  Ultra  vires  acts  and  dividends  leaving  insufficient  funds  to  pay 
debts  are  criminal  acts.  Shares  to  be  $100  par  value.  Ten  per  cent 
of  capital  to  be  paid  in  before  corporation  can  be  lawfully  organized, 
p.  235.  Stockholders  are  liable  to  corporate  creditors  to  an  amount 
equal  to  par  value  of  stock,  and  in  addition  to  subscription  liability. 
Execution  against  the  corporation  may  be  levied  on  stockholders'  prop- 
erty, on  motion  in  court  anfl  due  notice.  Officer  having  charge  of  books 
to  furnish  names  of  persons  liable,  p.  236.  Annual  return  of  property, 
capital,  stockholders,  etc.,  to  be  made  to  state  comptroller,  Id.  Copy 
ot. by-laws  shall  be  posted  and  published,  p.  235.  Failure  to  comply 
with  requisites  regarding  organization,  publicity,  diversion  of  funds, 
etc.,  shall  forfeit  privileges.  Upon  bill  filed,  court  of  equity  will  dissolve 
the  corporation,  p.  235.  Payment  for  stock  by  property  is  allowed  only 
when  the  facts  are  stated  in  the  articles  and  notice  of  incorporation, 
and  the  valuation  is  fixed  by  the  incorporators,  and  that  valuation  is  also 
stated  in  the  articles,  No.  61,  L.  1889. 

Railroads Three  or  more  may  incorporate,  p.  274,  Am'd  No.  60,  L. 

1889.     Shall  give  ninety  days'  notice  in  three  official  papers,  p.  274. 
Articles  to  be  signed,  endorsed  with  affidavits  of  three  directors,  and 
filed  with  secretary  of  state,  who,  with  governor,  issues  certificate  of 
incorporation,  p.  274.     Directors  (three  to  thirteen)  must  be  stockhold- 
ers, and  by  waiver  of  notice  may  be  elected  at  any  meeting.     Each  share 
has  one  vote.    Proxies  are  allowed.    Majority  elects.     Manner  of  voting 
may  be  fixed  by  by-laws,  pp.  275,  276.   Stock  transferable  under  by-laws, 
but  previous  calls  must  be  paid.    All  property  of  stockholders  expressly 
exempt  except  their  stock,  pp.  276,  277.    Capital  stock  may  be  increased 
with  concurrence  of  two-thirds  stock  vote,  p.  277.     May  borrow  money 
and  execute  trust  deeds  and  mortgages  upon  franchises  and  property, 
p.  279.     Purchasers  of  railroad  may  form  a  corporation,  p.  279.     Trust 
deeds  and  mortgages  shall  be  recorded  with  secretary  of  state,  pp.  280, 
286.     Authorized   to   lease,  purchase  or   consolidate  connecting  lines 
within  or  out  of  the  state,  and  to  own  and  run  vessels  in  connection  with 
road,  p.  285.  As  to  new  name,  see  p.  288.     Rolling  stock  is  declared  to 
be  a  fixture,  p.  286.     Domestic  railroad  corporations  are  authorized  to 
operate  out  of  the  state  under  any  other  laws,  p.  289.     It  is  declared  a 
misdemeanor  for  a  railroad  official  to  give,  or  a  state  officer,  member  of 
Legislature  or  delegate  to  political  convention  to  receive,  a  transporta- 


22 


98 


FLORIDA. 


§7 


a  corporation, 
y  incur,  must 
arter  may  be 
in,  and  of  in- 
d  annually  at 
t  funds  to  pay 

Ten  per  cent 
illy  organized, 
to  an  amount 
ption  liability, 
holders'  prop- 
large  of  books 
rn  of  properly, 
er,  Id.  Copy 
ure  to  comply 
sion  of  funds, 
ty  will  dissolve 
s  allowed  only 

incorporation, 
aluation  is  also 

m'd  No.  6o,  L. 
japers,  p.  274. 
directors,  and 
5  certificate  of 
t  be  slockhold- 
g.     Each  share 
inner  of  voting 
under  by-laws, 
)lders  expressly 
ay  be  increased 
borrow  money 
and  property, 
p.  279.     Trust 
F  state,  pp.  280, 
onnecting  lines 
connection  with 
k  is  declared  to 
e  authorized  to 
It  is  declared  a 
icer,  member  of 
'e,  a  transporta^ 


tion  pass,  L.  1887,  p.  113.  Consolidation  of  parallel  or  competing 
railroads  forbidden  except  upon  special  authority  from  state  railroad 
commission,  L.  1887,  p.  117.  By  Act  May  31,  1887,  all  private  property 
of  stockholders  is  expressly  exempted  from  corporate  liabilities,  except 
their  shares,  and  the  liability  thereupon  is  limited  to  unpaid  subscrip- 
tions, L.  1887,  p.  96. 

A  railroad  commission  exists  and  is  given  power  to  reduce  rates  to 
a  reasonable  basis,  L.  1889,  No.  16.  The  courts  hold  that  this  power 
cannot  be  used  to  reduce  the  rates  below  a  paying  point  to  the  railroads. 
See  Pensacola,  etc.,  Railroad  Company  v.  State,  5  S.  Rep.,  833. 

Banks. — May  be  established  in  towns  of  over  three  thousand  popula- 
tion, p.  237.  Capital  stock  to  be  $50,000  or  over,  secured  by  mortgage 
on  real  estate  and  one-fourth  invested  in  Florida  state  bonds  and  de- 
posited with  the  state.  Id.  Executors,  administrators,  trustees  or 
guardians  may  invest  trust  funds  in  the  stock  of  such  banks,  p.  238. 
Total  debts  shall  not  exceed  double  the  amount  of  capital  actually  secur- 
ed. Branches  may  be  organized.  Public  officers  may,  but  are  not  required 
to,  deposit  funds  in  such  banks,  p.  238.  Any  creditor  or  shareholder 
interested  to  extent  of  $1000  may  apply  to  a  judge,  who  may 
order  a  commissioner  to  examine  condition  of  bank,  p.  239.  De- 
tailed annual  returns  of  condition  to  be  made  to  state  comptroller, 
p.  239.  Failure  to  return  for  one  month  entails  dissolution  as  insolvent, 
p.  240.  By  act  March  9,  1883,  "The  Bank  of  the  State  of  Florida" 
was  incorporated  in  perpetuity,  with  a  capital  of  $100,000,  having  trus- 
tee powers,  with  all  privileges  of  above  act.  $50,000  approved  interest 
bearing  bonds  to  be  deposited  with  the  state.  Stockholders  liable  to  an 
amount  equal  to  shares  held.  Branches  authorized.  All  rights  thus 
granted  to  be  subject  to  future  legislation,  L.  1883,  pp.  144-146. 

Taxation. — Shares  of  stock  are  taxed,  ch.  3143,  L.  1883.  Real  es- 
tate of  the  corporation  is  taxed  the  same  as  that  of  individuals.  Shares 
of  stock  in  corporations  which  are  taxed  on  the  capital  stock  are  not 
taxed,  Id.  Railroads  are  assessed  by  the  state  comptroller  and  the  assess- 
ment apportioned  to  the  municipalities,  ch.  3556,  L.  1885.  State  tax 
on  bank  stock  shares  is  not  to  exceed  twenty^five  cents  on  each  share  of 
$100,  Dig.  of  Fla.,  L.  1881,  p.  241.  "  All  public  stocks  or  shares  in  all  in- 
corporated companies  "  are  subject  to  taxation,  L.  1887,  p.  I.  Shares  are 
not  taxed  to  individual  owners  where  the  corporation  is  taxed  on  capital, 
L.  1887,  p.  3,  §  8.  All  banks  having  capital  stock  of  $100,000  shall  pay 
license  tax  of  $100  ;  those  having  capital  of  $50,000,  pay  $50  ;  $25,000, 
$30  ;  less  than  $25,000,  $20.  Express  companies  pay  license  tax  of  $100, 
Id.  p.  7.  Railroad  property  is  assessed  by  state  board  and  apportioned  for 
taxation  to  municipalities  through  which  it   passes,  Id.  p.  18.    Real  es 


mm 


§8 


OEORQIA. 


24 


tate  not  used  in  operation  of  road  is  taxed  as  individual  property,  Id. 
p.  20.  The  levy  for  state  purposes  for  1888  was  four-and-a-half  mills, 
Id.  p.  27.  Real  estate  for  corporations  taxed  same  as  individual  proper- 
ty, Id.  p.  3,  §  6.  Each  share  of  siock  in  a  state  bank  shall  be  taxed 
not  to  exceed  twenty-five  cents,  p.  241. 

g  8.  GEORGIA.  Constitational  Law.—"  The  general  assembly  shall 
have  no  power  to  grant  corporate  powers  and  privileges  to  pri- 
vate companies,  except  banking,  insurance,  railroad,  canal,  navigation, 
express  and  telegraph  companies,  .  .  .  but  it  shall  prescribe  by 
law  the  manner  in  which  such  powers  shall  be  exercised  by  the  courts," 
Art.  III.,  §  7,  Code  1882,  §  5077.  The  general  assembly  is  not  to 
authorize  street  railways  without  consent  of  municipal  authorities,  Art. 
3,  §  7.  Domestic  and  foreign  life  insurance  companies  must  deposit 
$100,000  as  a  guarantee  fund,  Art.  III.,  §  12.  Corporations  shall  not  buy 
Stock  in  other  corporations  nor  "make  any  contract,  or  agreement 
whatever  .  .  .  which  may  have  the  effect,  or  be  intended  to  have  the 
effect,  to  defeat  or  lessen  competition  in  their  respective  businesses  or  to 
encourage  monopoly,  and  all  such  contracts  and  agreements  shall  be  il- 
legal and  void,"  Art.  IV.,  §2,8  5097.  Power  to  tax  corporations  shall  not 
be  contracted  away,  Art.  VII.,  §  2,  §  5185.  State  shall  not  loan  or  pledge 
its  credit  to  or  subscribe  to  or  become  joint  owner  with  any  corpora- 
tion. Id.  §  5,  §  5185.  General  assembly  shall  not  authorize  any  munici- 
pality to  aid  or  subscribe  or  buy  stock  in  any  corporation,  Id.  g  7,  §  5 189, 

Miscellaneous  Corporationg.— Private  corporations  may  be  created  for 
any  purpose  except  banking  or  insurance.  Petition  to  be  filed  with 
clerk  of  superior  court  of  county  and  published  one  month.  Court 
passes  upon  application  and  grants  order.  Ten  per  cent  of  capital 
specified  must  be  paid  in.  Powers  cease  if  not  used  within  two  years. 
In  case  of  failure,  stockholders  are  liable  for  subscriptions.  May  hold 
property  only  for  charter  purposes  and  to  secure  debts,  Code  of  1882, 
§  1676.  Foreign  corporations  are  forbidden  to  hold  land  to  extent  of 
5,000  acres  or  more  unless  they  incorporate  in  Georgia,  §  1675  a. 

Bailroads.— Three  or  more  may  incorporate,  g  1689.  Notice  and 
articles  to  be  published  for  thirty  days.  Articles  and  affidavits  of  three 
directors  to  be  filed  with  secretary  of  state,  who,  with  the  governor,  shall 
issue  certificate,  g  1689  a,  amended  L.  1882-3,  p.  135.  Directors,  three 
to  thirteen,  must  be  stockholders,  g  1689  d.  At  every  election,  the  books 
and  papers  of  the  corporation  must  be  exhibited  at  the  meeting,  if  a 
majority  of  the  stockholders  so  desire,  g  1689,  d.  Five  per  cent  of 
stock  must  be  paid  before  work  begins.  Subscriptions  may  be  paid  in 
property,  g  1689  f.     Stock  not  transferable  until  all  previous  calls  are 


^mmm 


94 


26 


GEOKOIA. 


8  8 


il  property,  Id. 
ind-a-half  mills, 
dividual  proper- 
shall  be  taxed 


il  assembly  shall 
vrileges  to  pri- 
mal, navigation, 
ill  prescribe  by 
by  the  courts," 
jembly  is  not  to 
authorities,  Art. 
;s  must  deposit 
ins  shall  not  buy 
,  or  agreement 
nded  to  have  the 
"businesses  or  to 
lents  shall  be  il- 
)rations  shall  not 
ot  loan  or  pledge 
h  any  corpora- 
rize  any  munici- 

,Id.§7,  §5189. 
ly  be  created  for 
o  be  filed  with 
month.  Court 
cent  of  capital 
vithin  two  years, 
ons.  May  hold 
,  Code  of  1882, 
and  to  extent  of 

§  1675  a- 
89.    Notice   and 

ffidavits  of  three 

e  governor,  shall 

Directors,  three 
ection,  the  books 
meeting,  if  a 
ive  per   cent  of 

may  be  paid  in 
evious  calls  are 


paid,  8  1689  g.  Must  have  a  principal  office  in  state,  §  1689  s.  Pur- 
chaser of  railroad  may  form  corporation,  g  1689  v.  One-third  ot 
stock  may  call  meetings,  §  1689  qq.  Stockholders  are  not  liable,  for 
corporate  debts,  except  on  unpaid  subscriptions,  §  1689  g.  May  con- 
solidate with  other  lines,  except  competing  lines,  g  1689  o,  z,  and 
bb.  Books,  records,  papers,  etc.,  of  the  corporation  are  always  open  to 
officer,  director  or  committee  of  stockholders,  g  1689  q.  May  issue 
bonds  to  extent  of  one-half  ot  capital  stock  paid  in  and  give  mortgage 
therefor,  g  1689  nn.  All  railroads  must  file  copies  of  charters  with 
amendments,  names  of  officers,  etc.,  with  secretary  of  state  under 
penalty  of  $500  for  each  twenty  days  failure,  L.  1882-3,  P-  '48.  These 
returns  to  be  published  with  the  session  acts,  L.  1884-5,  P-  '3*-  ^ 
railraod  commission  is  given  power  to  regulate  rates,  Code  gg  719, 
7196. 

Banks.— Banks  are  incorporated  by  special  acts  of  the  general 
assembly.  Semi-annual  returns  to  be  made  under  oath  to  the  governor 
and  published,  Id,  §g  1466-1471.  Stockholders  liable  directly  to 
creditors  for  unpaid  stock,  Id.  g  1491.  To  escape  individual  liability 
imposed  by  charter  a  transferer  of  stock  must  publish  notice  of  transfer 
once  a  month  for  six  months  in  two  papers,  Id.  g  1496.  Sept.  2d,  1887, 
an  act  was  approved  to  authorize  manufacturing  and  mining  companies 
to  become  incorporated  as  savings  banks;  to  prescribe  the  manner  of 
such  incorporation;  to  define  the  powers  and  liabilities  of  such  com- 
panies when  so  incorporated;  to  secure  by  lien  and  define  the  rights  of 
deposos  therein;  and  to  fix  the  rate  of  interest  to  be  paid,  etc.  L.  1887, 
PP-  9'.  93- 

Miseellaneons  ProTlsions. — Declared  a  misdemeanor  for  an  officer 
or  agent  of  bank  or  other  corporation  to  use  or  borrow  funds  thereof 
for  himself,  directly  or  indirectly,  without  permission  of  a  majority  of 
directors  or  of  a  committee  of  directors  authorized  to  act,  L.  1887,  p.  94. 

Taxation. — «« Manufacturing  and  other  corporations,  except  rail- 
roads, insurance  and  other  quasi  public  corporations  "  must  make  returns 
of  all  their  property  "  at  the  true  market  value,  to  the  tax  receiver  of 
the  county  where  the  same  is  lOcated,  or  where  Jhe  principal  business  of 
each  company  is  located,  to  be  taxed  for  state  and  county  purposes  as 
other  property  in  this  state  is  taxed."  Banks  are  taxed  on  shares  of 
stock,  Gen.  Tax  Act  for  1887-8  ;  see  L.  886,  pp.  14,  20,  21,  and  L. 
1887,  pp.  22,  24.  Express,  telegraph  and  electric  light  companies  pay 
two  and  a  half  per  cent  on  gross  receipts.  Id.  Railroads  are  taxed  on 
property  not  used  for  its  usual  business  the  same  as  individuals,  L. 
1882-3,  p.  41.  Are  taxed  on  rolling  stock  in  proportion  to  amount  of 
track  inside  the  state,  L.  1882-3,  P-  4*-     All  corporate  realty  and  per- 


8  9 


ILLINOIS. 


29 


sonalty  are  subject  to  taxation,  Code  of  Georgia,  1882,  §  799.  Corpora- 
tions also  liable  to  tax  on  capital  stock,  §  802.  Banks  are  taxed  by  tax 
on  shares  of  stock  only,  §  815.  All  other  corporations  "  pay  the  same 
rate  per  cent  upon  the  whole  amount  of  their  capital  stock  paid  in,  as. 
is  levied  on  other  capital  together  with  the  same  rate  per  cent  upon 
their  net  annual  profits,"  §  816.  "Railroads  not  paying  dividends  over 
six  per  cent  pay  a  tax  of  one-half  of  one  per  cent  of  net  annual 
income,  until  they  pay  a  dividend  of  eight  per  cent,  §  818.  Non- 
resident railroads  pay  a  tax  on  property  in  state,  also  a  tax  on  net  earnings, 
g8i9.  Corporations  not  paying  tax  forfeit  their  charters,  §  877.  Clerks' 
fees  are  the  usual  charges  and  not  to  exceed  eight  dollars,  Id.  g  1676. 

g  9.     ILLINOIS.— Constitutional  Provisions.  —  Irrevocable  grants  of 
special  privileges  or  immunities  are  prohibited.  Art.    II.  §  14.     Special 
laws  granting  to  corporations  the  righi  to  lay  down  railroad  tracks  are 
jjrohibited,  also  granting  to  corporations  any  special  or  exclusive  privi- 
lege, immunity  or  franchise  whatever.  Art.  IV.   §22.    Taxation  shall  be 
such  that  "  every  person  and  corporation  shall  pay  a  tax  in  proportion 
to  the  value  of   his  or  her,  or  its  property,"  Art.  IX.  §  i.»    Every  stock- 
holder may  vote  his  stock  "  for  as  many  persons  as  there  are  directors- 
or  managers  to  be  elected,  or  to  cumulate  said   shares,  and  give  one 
candidate  as  many  votes  as  the  number  of  directors  multiplied  by  the 
number  of  his  shares  of  stock  shall  equal,  or  to  distribute  them  on  the 
same  principle  among  as  many  candidates  as  he  shall  think  lit,  and 
such  directors  or  managers  shall  not  be  elected  in  any  other  manner," 
Art.  XI.  §  3."    Corporations  shall  not  be  created  by  special  charter,  Id.. 
§  1.     No  street  railway  shall  occupy  a  street  unless  the  local  govern- 
ment assents  thereto,  Id.  §  4.     Laws  authorizing  bank  corporations,  to- 
be  first  approved  by  vote  of  the  people.  Id.  §  5.     See  Reed  v.  People, 
18    N.  E.  Rep.  295    (1888.)       Stockholders  in  banks  are    liable  to 
amount  of  stock  to   corporate  creditors  for  liabilities  "  accruing  while 
he    or    she   remains    such     stockholder,"     Art.    XI.     §   d?     Banks 
must  make  and  publish  quarterly  reports.  Id.  §  7.      Railroad   com- 
panies organized  or  doing  business  in  the  state  must  keep  books  in  the 
state,  giving  stockholders,  and  assets  and  liabilities,  open  for  public  in- 
spection* and  must  make  annual  reports,  Id.  g  9.      Rolling  stock  is 
personalty  and  is  to  be  subject  to  execution,  Id.  §  10.  Consolidation  of 
parallel  or  competing  lines  is  forbidden.     Majority  of  directors  of  rail- 
road companies  must  be  citizens  and  residents  of  the  state,  Id.  §11.'  Fic- 
titious or  watered  stock  or  bonds  are  void.*     Stock  dividends  are  pro- 
'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxiv. 
»/</..  chap :er  XXX. ii.  •/</.,  chapter  xu. ,  xv.  «/</.,  chapter  xxx 

•/</.,   chapter  xxxvii.  */rf.,  chapter  iii. 


9» 

799.  Corpora- 
re  taxed  by  tax 
"  pay  the  same 
ock  paid  in,  as- 

per  cent  upon 
/  dividends  over 

of  net  annual 
,  §  818.  Non- 
on  net  earnings, 
,  §  877.  Clerks" 
rs,  Id.  g  1676. 

■ocable  grants  of 
[.  §  14.  Special 
Iroad  tracks  are 

■  exclusive  privi- 
Taxation  shall  be 
IX  in  proportion 
I.'  Every  stock- 
;re  are  directors- 
s,  and  give  one 
lultiplied  by  the 
ute  them  on  the 
ill  think  fit,  and 

■  other  manner," 
ecial  charter.  Id- 
he  local  govern- 

;  corporations,  to- 
Reed  v.  People, 
ks  are    liable  to 
"  accruing  while 
.     §   6.3     Banks 
Railroad   com- 
eep  books  in  the 
pen  for  public  in- 
Rolling  stock  i» 
Consolidation  of 
directors  of  rail- 
ite,Id.  §  ii.»  Fic- 
ividends  are  pro- 
Law,  chapter  xxxiv. 
*Id.,  chapter  xxz 


27 


ILLINOIS. 


8  9 


hibitecl,  Id.  §  13.  "No  county,  city,  town,  township  or  other  municip- 
ality shall  ever  become  subscriber  to  the  capital  stock  of  any  railroad 
or  private  corporation         .     .   ,"  Amendment  of  1870.' 

MlHcellaneons  CorporitlouH.— May  be  formed  hereunder  for  any  lawful 
purpose,  except  for  banking,  insurance,  real  estate,  brokerage,  operation 
of  railroads  and  loaning  money,  R.  S.  ch.  32,  g  i.  From  three  to  seven 
may  incorporate.  Duration, of  company  may  be  ninety-nine  years,  Id.  g  2. 
Must  organize  and  proceed  to  business  within  two  years.  Id.  §  4.''' 
Corporate  powers  shall  be  exercised  by  aboard  of  directors  or  managers. 
Directors  may  adopt  by-laws.  Id.  g  6.  Both  transferer  and  tranferee 
are  liable  for  unpaid  subscriptions.  Id.  §  8.'  Books  of  account  of  all 
corporate  business  to  be  kept  and  o|)en  to  inspection  of  stockholders 
at  all  reasonable  times.  Id.  g  13.*  Directors  and  officers  are  liable  for 
excess  of  corporate  debts  over  the  capital  stock.  Id.  g  16.  Liable  also 
for  debts  contracted  before  full  capital  stock  is  subscribed,  Id.  g  18. 
Directors'  meetings  to  be  held  within  the  state.  If  held  out  of  state  are 
valid  only  when  ratified  by  a  two-thirds  vote  in  the  state.  Id.  g  20. 
Officers  liable  for  damages  for  any  false  report,  statements  or  repre- 
sentations, Id.  g  21.  Two-thirds  in  interest  of  stock  may  call  a  stock- 
holders' meeting.  Id.  g  22,  Pledgees,  etc.,  are  not  liable  as  stockhold- 
ers. Id.  g  23.  Foreign  corporations  for  piofit  shall  not  purchase  of 
hold  real  estate,  except  as  domestic  corporations  may.  Foreign  cor- 
porations not  to  have  greater  jjowers  than  domestic  corporations.  Id. 
g  26.  The  business,  name,  etc.,  of  the  corporation  may  be  changed  by 
the  corporation,  L.  1889,  p.  95. 

Railroads. — Five  or  more  may  incorporate  for  fifty  years  Renewal 
allowed  on  three-fourths  vote  and  buying  out  of  dissenting  stock- 
holders, R.  S.  ch.  114,  gg  I,  5.  Books  giving  full  information  as  to  the 
stockholders  and  payments  on  stocks  to  be  kept  in  the  state  and  open 
to  public  inspection.  Id.  g  7.  Powers  are  to  be  exercised  by  directors 
who  are  to  be  stockholders.''  Stockholders'  annual  meeting  to  be  held  in 
the  state,  Id.  g  8.*  One-fourth  of  the  stock  may  call  a  meeting.  Id.  g  9. 
Full  reports  required  at  annual  meeting,  and  at  any  meeting,  if  ma- 
jority of  those  present  demand  it.  Id.  g  lo.  Two-thirds  of  the  stock 
may  remove  any  director  or  officer  and  elect  others  to  fill  the  place, 
at  any  special  meeting.  Id.  g  10.  "All  stockholders  shall,  at  all  reason- 
able hours,  have  access  to  and  may  examine  all  the  books,  records 
and  papers  of  such  corporation,"   Id.''     Majority   of  directors  shall 

'See  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  vl. 
•/rf. ,  chapter  xxxviii.  *Id. ,  chapter  xv.  *Id. ,  chapter  xxx. 

*/</.,  chapter  xxxvii.  */</.,  chapter  xxxvi.  ''Id.,  chapter  xxx. 


mm 


§  1 


INDIANA. 


u 


be  citizens  and  residents  of  state,  Id.  g  ii.'  Corporation  shall  not 
purchase  its  own  stock  or  stock  in  any  other  corporation,  nor  loan  money 
to  an  officer  or  director,  Id.  J5  i4.'''  Pledgees,  etc.,  not  liable  as  stockhold- 
ers, Id.  }$  i6.  Lines  not  competing  or  parallel  may  consolidate,  lease,  etc., 
Id.  J5g  23.  etc..  Act  of  June  30,  1885.  No  mortgage  alloved  unless 
two-thirds  of  the  stock  assent  thereto,  ch.  114,  R.  S.,  |5{|  20,  34,  etc.* 
Cumulative  voting  prevails,  Id.  g  25. ^  Transfer  and  stock  books 
must  be  kept  within  the  stae,  L.  1883,  p.  128.  A  railroad  commission 
has  power  to  reduce  rates.  Act  of  June  30,  1885. 

Taxation." — Shares  of  stock  are  taxed,  R.  S.,  ch.  120  g  1.  Also  the 
capital  stock  of  all  corporations  incorporated  by  the  state.  Id.  The  as- 
sessment of  capital  stock  is  its  cash  value,  including  franchise,  less  the 
assessed  value  of  its  tangible  property.  Is  assessed  by  state  board.  If 
capital  stock  or  tangible  property  is  assessed  shares  of  stock  are  not  to 
be  assessed,  except  in  case  of  banks.  Manufacturing  corporations  pay 
'  local  tax  on  tangible  property,  but  no  state  tax,  Id.  g  3.  Capital  stock 
is  taxed  where  the  principal  place  of  business  is.  Id,  g  7.  Corporations, 
except  banks  and  manufacturing,  must  report  actual  value  of  all  shares 
of  stock,  indebtedness  and  tangible  property,  Id.  §  32.  Bank  stock  is 
taxed  at  the  location  of  the  bank,  Id.  §  35, etc.  Railroads  are  required 
to  report  to  municipalities  all  realty,  personalty  and  proportiou  of  rolling 
stock  owned  in  each  on  May  i.  It  is  then  assessed  by  the  municipality. 
Report  is  forwarded  to  the  state  board,  Id.  gg  40-50.  State  board 
assess  the  capital  stock  and  railroad  track  and  rolling  stock,  and  appor- 
tion the  same  among  the  municipalities  interested,  Id.  gg  109-111. 

g  10.  INDIANA.  Constitational  ProTlslons.— Counties  are  forbidden 
to  subscribe  for  stock  unless  it  is  paid  for  at  the  time  of  subscription. 
Counties  not  to  loan  their  credit  to  corporations  nor  borrow  money  to 
pay  for  stock,  Art.  I.  g  6.*  Stockholders  in  banks  are  individually  liable 
for  par  value  of  stock  in  addition  to  subscription  price.  Art.  II.  g  6.''  No 
corporation  except  banks  shall  be  created  by  special  act.  Art.  II.  g  13. 

Miscellaneous  Corporations. — Three  or  more  may  incorporate  for 
manufacturing,  mining  and  a  few  other  specific  purposes,  R.  S.,  1887, 
g  3851.9  May  hold  real  estate  necessary  for  business  and  inpayment 
of  or  to  secure  debts,  g  3853.*  Directors  shall  be  stockholders  and 
residents  of  the  United  States,  g  3854.»<»  Each  share  has  one  vote 
gg  3855,  3878.      Capital  stock   may  be  "increased  by  a  vote  of  the 

'Cook  on  Stock  and  Stockholders,  and  General  Corporation  Law,  chapter  xxxvii. 
•/</.,  chapter  xH.  HH  •/</.,  chapter  xU.  ♦/</.,  chapter  xxxvii. 

*/</. ,  chapter  xxxiv.  '/</. ,  chapter  vi.  Vrf. ,  chapter  xii. 

•/</.,  chapter  xiii.  §  236.  •/</.,  chapter  xli.  "Id.,  chapter  xxxvii. 


"TTI 


28 

)ratiun  shall  not 
I,  nor  loan  money 
ibleas  stockhoid- 
iidate,  lease,  etc., 
e  alloved  unless 
«»  ao,  34,  etc.» 
and  stock  books 
iroad  commission 

20  g  1.     Also  the 

ate,  Id.     The  as- 

ranchise,  less  the 

y  state  board.    If 

f  stock  are  not  to 

corporations  pay 

3.    Capital  stock 

7.    Corporations, 

kraiue  of  all  shares 

a.     Bank  stock  is 

roads  are  required 

oportio'i  of  rolling 

the  municipality. 

-50.    State  board 

stock,  and  appor- 

,  §§  109-111. 

[ities  are  forbidden 
e  of  subscription, 
borrow  money  to 
individually  liable 
,  Art.  II.  §  6.'   No 

act,  Art.  II.  §  13. 
y  incorporate  for 
}oses,  R.  S.,  1887, 
is  and  in  payment 

stockholders  and 
lare  has  one  vote 

by  a  vote  of  the 

Law,  chapter  xxxvii. 
*Jd.,  chapter  xxxvii. 
Vrf.,  chapter  xii. 
"Id.,  chapter  xxxvii. 


29 


INDIANA. 


«    10 


Stockholders  at  any  annual  meeting,"  J}  3857.  Corjxjrations  shall  not 
purchase  stock  in  any  other  corporation,  J|  3858.'  Capital  stock  to  l)e 
paid  within  t'iijhteen  months,  }{  3859.  .Animal  verifieil  report  must  he 
published,  {531^63.  Directors  are  liable  for  any  false  representation  or 
report,  |}  3865.  StockhoMcrs  are  liable  for  debts  due  to  laborers,  etc., 
^  3869.'  May  amend  charter  so  as  to  enlaij^e  its  objects,  {}  3870.  Foreign 
corporations  for  same  purpose  shaM  have  the  same  right  to  purchase  realty 
as  the  domestic, }}  3879.'  Incor|M)ration  for  dealing  in  real  estate  and  for 
mercantile  business  authorized.  Act  of  March  6,  1889.  The  capital 
stock  is  not  to  exceed  $250,000,  Id,  Trusts  of  stock  in  gas,  electric  light 
or  water  companies  legalized.  Act  of  March  5,  1889. 

.  RailroadM. — Fifteen  or  more  subscribers  for  stock  may  inc  jrporate. 
Directors  to  be  stockholders,  J|  3885.*  Railroads  may,  by  vote  of  direc- 
tors, increase  capital  stock  to  $15,000  per  mile,  {j  3890  and  g  3931. 
Annual  meeting  of  stockholders  to  be  held  in  one  of  count.es  through 
which  the  railroad  runs.  Stock  owned  ten  days  previous  to  election  only 
shall  be  voted,  g  3892.*  One-fourth  in  interest  of  stocHiolders  may 
call  special  meetings,  g  3893.  Majority  present  at  meeting  may  de- 
mand statement  of  condition  of  corporation.  Majority  in  interest  may, 
at  general  meetings,  remove  president  and  directors  and  elect  others, 
g  3894.  Directors  make  the  by-laws,  g  3897.  Certificate  of  capital 
fully  paid,  shall  be  i\\^i\  with  secretary  of  state,  g  3899.  Property  sub- 
scriptions may  be  received  and  the  property  sold,  g  3901.  Preferred 
stock  may  be  issued  not  to  exceed  half  of  the  capital,  and  with  such 
priority  as  may  be  approved  by  directors  and  majority  of  stockholders, 
gg  3912,  3949.  Annual  report  to  secretary  of  state  required,  g  3918. 
Stockholders  are  liable  for  money  due  to  laborers,  etc.,  g  3934.'  Reorgan- 
ization arrangements  are  valid  and  effectual,  gg  3937,  3938,  etc.^  Pur- 
chasers at  foreclosure  sale  may  be  incorporated,  g  3946,  Railroads  may 
purchase  and  consolidate  with  other  roads,  and  with  branches  which  have 
not  been  equipped  or  operated  in  whole  or  in  part,  g  3951.  May  guaran- 
tee bonds  of  other  companies  not  exceeding  half  the  par  value  of  own 
stock,  gg  395i*-395i*=.  Consolidations  authorized,  gg  3951,  3965,  etc. 
Conditional  sales  of  rolling  stock  legalized.  Act  of  March  9,  1889. 

Banks. — Five  or  more  may  incorporate  as  bank  of  discount  and  de- 
posit, with  a  capital  not  less  than  $25,000,  R.  S.  1881,  g  2684.  Shall 
transact  no  business  except  organization  until  fifty  per  cent  of  whole 
capital  stock  is  actually  paid  in,  and  sworn  certificate  of  that  fact  is  filed 
with  secretary  of  state,  g  2687.  No  officer  or  clerk  shall  vote   a  proxy. 

'  Coolc  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xix. 
*/</.,  chapter  xii.  '/</.,  chapter  xli.  '/</.,  chapter  xxxvii. 


f  I 


*Jd, ,  chapter  xxxvii. 


*/</.,  chapter  xii. 


'/</.,  chapter  xxxix. 


«  10 


INDIANA. 


10 


Pirectors'  books  of  transactionH  to  be  open  for  inspection  to  stock- 
holders, 5j  a6<i8.'  Kacli  director  must  own  five  shares  of  stock,  }}  2689.' 
Resithie  of  capital  stock  (see  supra  %  2687)  mll^t  be  paid  in  within  six 
months,  }}  2690.  Capital  stock  may  l)e  increased  or  decreased  l)y  a 
two'thirds  stock  Tote,  at  a  meetii\K  specially  noticed,  and  re|)re- 
genting  two-thirds  of  stock,  g  2691.  Ten  per  cent  of  annual  net 
profits  shall  be  set  apart  as  a  surplus  fund,  until  same  amounts  to 
twenty-five  per  cent  of  capital  stock,  {}  2692.  List  of  stockholders  al- 
ways open  to  inspection,  J}  2693.»  Real  estate  may  be  held  for  busi- 
ness accommodations,  and  to  pay  or  secure  debts,  J}  2695.*  Stockholders 
are  liable  for  par  value  of  stock  in  addition  to  amount  invested  therein, 
g  2696.*  Annual  statements  of  condition  are  to  be  published,  }}  2699. 
Auditor  of  state  may  direct  an  examination  of  affairs  at  any  time,  |5  2701. 
At  least  five  times  each  year  a  detailed  report  shall  be  made  to  auditor 
and  published,  §  2702. 

Havings  Banks. — "  Any  numbt  -  of  persons,  being  voters  of  this 
state,  not  less  than  seven  nor  more  .'han  twenty-one,  who  shall  have 
been  citizens  of  the  county  where  they  rhen  reside  for  at  least  five  years 
then  next  preceding,  and  who  shall  severally  own  unincumbered  real  es- 
tate therein  worth  at  least  $5,000,  exclusive  of  perishable  improve- 
ments, may  associate  themselves  together  for  the  purpose  of  organizing 
and  managing  a  savings  bank  in  such  county,  in  accordance  with  the 
provisions  of  this  act,  as  a  body  politic  and  corporate,"  §2703.  The 
articles  containing  the  names  of  the  incorporators  must  be  approved  by 
a  circuit  judge  and  recorded,  §  2705.  Investment  limited  to  public 
securities,  bonds  and  mortgages  and  si.  "'  notes  and  bills  indorsed  by 
two  local  freeholders,  §  2721.  Must  keep  twenty  per  cent  of  total  de- 
posits as  reserve,  %  2724.  May  take  real  estate  to  secure  or  in  payment 
of  debts  and  may  own  building  for  accommodation  and  to  rent,  but  it 
shall  not  cost  more  than  five  per  cent  of  amount  of  deposits,  §g  2726, 
^727.  One-half  of  one  per  cent  to  be  reserved  from  annual  gross 
profits  as  a  surplus  fund  until  such  fund  equals  ten  per  cent  of  amount 
of  deposits  and  it  may  continue  till  it  reaches  twenty-five  per  cent,  § 
3730.  These  banks  are  managed  for  the  profit  of  the  depositors,  g§ 
2736,  2737.  Annual  reports  to  be  made  to  state  auditor,  §§  2742, 
etc.  Money  belonging  to  wards  of  the  court  not  exceeding  $1,000  may 
be  ordered  deposited  in  a  savings  bank,  §  2756. 

General  Proyislons. — "  Shares  shall  be  numbered  in  progressive  or- 
der, beginning  at  number  one,"  §  3003.      When  capital  is  withdrawn 

'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxx. 
•/rf. ,  chapter  xxxvii.  •/</.,  chapter  xxx.  *M,  chapter  xli. 

*Id.,  chapter  xii. 


30 

lectioii  to  stock- 
of  stock,  ($  2689." 
paid  ill  within  six 
or  (IccrcasccI  l)y  a 
iced,  and  re|ire- 
it  of  annual  net 
iame  amounts  to 
)f  stockholders  al- 
'  be  held  for  busi- 
tg$.*  Stockholders 
It  invested  therein, 
published,  ^  2699. 
t  any  time,  ^  3701. 
)e  made  to  auditor 

ig  voters  of  this 
;,  who  shall  have 
•  at  least  five  years 
icumbered  real  es- 
^rishable  improve- 
posc  of  organizing 
cordaiice  with  the 
te,"  8  3703-  'I'he 
st  be  approved  by 
limited  to  public 
bills  indorsed  by 
cent  of  total  de- 
;ure  or  in  payment 
and  to  rent,  but  it 
ieposits,  §§  3736, 
rom  annual  gross 
er  cent  of  amount 
y-five  per  cent,  § 
he  depositors,  §§ 
auditor,  §§  3743, 
eeding  $1,000  may 

in  progressive  or- 
)ital  is  withdrawn 

Law,  chapter  xxx. 
*/J. ,  chapter  zli. 


"TTTl 


iin 


ti 


IOWA. 


»    11 


and  refunded  all  stockholders  become  personally  liable  for  all  debts,  g 
3007.'  liook  containing  names  of  stockholders  shall  always  be  open  to 
public,  g  3010.'  Ceitam  corporations  may  borrow  on  mortgages  and  may 
issue  luiiuls  and  stocks  to  be  sold  below  par,  §  3019.  Direccors  may, 
by  two-thirds  vote,  decrease  or  increase  capital  stock,  |}  303 1*.  An 
insurance  company  may  hold  real  estate  not  exceeding  $500,000,  § 
302 if.  Id.  \J\ym  insolvency  the  liability  of  the  stockholders  is  for  an 
amount  equal  t(j  amount  of  their  stock  when  debts  were  contracted,  but 
directors  with  assent  of  stockholders  may  increase  il  to  three  times  that 
amount,  1^  302  ig.  Id."  Foreign  corporations  doing  business  in  the  state 
must  fde  in  the  county  where  they  do  business,  a  |)ower  of  attorney  to 
their  agent,  §  3033.*  Foreign  corporations  removing  cases  into  United 
States  courts  shall  forfeit  their  right  to  do  business,  ^3039.*  Stockhold- 
ers are  liable  for  money  due  to  laborers,  etc.,  in  absence  of  written 
contract  to  the  contrary,  g  5306a.* 

Taxation.'' — Shares  of  stock  in  domestic  and  foreign  cor|Xjrations  are 
to  be  taxed,  §  6373.  ^^"*  "ot  if  the  capital  stock  is  assessed  in  the 
state,  §  6386.  Capital  stock  and  franchises  are  taxed  at  principal  place 
of  business.  Id.  6391.  Franchise  is  listed  as  personalty,  g  6303.  Bank 
shares  are  taxed,  gg  6306,  6307,  6343,  6349.  When  the  tangible  property 
or  the  capital  stock  is  listed,  the  shares  of  stock  are  not  taxable,  g  6308. 
All  domestic  corporations,  except  railroads,  etc.,  are  taxed  on  the  capital 
stock,  valued  from  the  market  value  of  all  the  shares  of  stock  and  the 
amount  of  paid  up  capital,  also  the  indebtedness  and  assessed  valuation 
of  tangible  property,  gg  6357,  6359.  Railroads  are  taxed  by  the  various 
municipalities  through  which  they  pass,  on  land,  buildings,  track,  etc., 
and  a  proportion  of  rolling  stock,  etc.,  g  6390.  Railroad  property  is 
assessed  by  the  state  and  apportioned  to  the  municipalities,  g  6410. 
F«e  of  secretary  of  state  for  filing  charter  is  $1.00,  g  5609. 

• 

§11.     IOWA.    CoDBtitntlonal  Provisions.— Corporations  shall  not  be 

created  by  special  laws,  Art.  VIII.  g  i,  "The  property  of  all  cor- 
porations for  pecuniary  profit  shall  be  subject  to  taxation  the  same  as 
that  of  individuals,"  Id.  g  3.  State  shall  not  be  a  stockholder  nor 
assume  or  pay  the  debts  of  corporations,  Id.  g  3.  Municipalities  shall 
not  be  stockholders  in  banks,  Id.  g  4.  Laws  authorizing  banking  cor- 
porations must  first  be  submitted  to  a  vote  of  the  people  and  approved 
by  majority,  Id.  g  5.  Stockholders  in  banks  are  liable  to  corporate 
creditors  to  extent  of  par  value  of  their  stock,  in  addition  to   the  sub- 

'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xii. 
'/</.,  chapter  xxx.  '/</.,  chapter  xii.  V</.,  chapter  xli. 

*/</.,  chapter  xli.  '/d.,  chapter  xii.  '/</.,  chapter  xxxiv. 


;i 


r 


§  1- 


IOWA. 


82 


I 


scription    liability,  Id.  §  9.'     Indebtedness   of   municipalities  shall   not 
exceed  five  per  cent  of  assessed  value  of  their  property,  Art.  II.  §  3. 

Miscellaneous  CorporationH.— Any  number  of  persons  may  mcorporate 
for  any  lawful  business,  Revised  Code  1888,  §  1058.  Articles  of  in:or- 
poraiion  are  to  fix  the  highest  limit  of  corporate  indebtedness  which  must 
not  be  more  than  two-thirds  of  capital  stock,  but  this  shall  not  apply  to 
debentures  or  bonds  secured  by  actual  transfer  of  real  estate  securities, 
§  1 06 1.  Except  that  railway  companies'  debt  may  be  to  extent  of 
$16,000  a  mile  of  track,  ch.  22,  Laws  1884.  Articles  are  to  be  filed  and 
notice  published,  §§1062-1064.*  Articles  may  be  amended,  §  1065, 
Articles  must  be  published,  §  1064.^  No  dissolution  prior  to  lapse  of 
charter,  except  by  unanimous  vote,  unless  articles  provide  otherwise,  § 
io66.  A  failure  to  comply  substantially  with  the  incorporating  act  ren- 
ders the  stockholders  liable  for  all  debts,  but  this  provision  does  not  apply 
to  railroad  corporations,  §  1068.^  May  incorpoiate  for  twenty  years. 
For  internal  improvement  fifty  years.  Mny  renew  the  charter  on  a 
three-fourths  vote,  upon  buying  out  dissenting  stockholders,  §  1069. 
Fraud,  deception  of  public  and  diversion  of  funds  forfeit  all  privileges 
and  are  otherwise  punishable,  §§  107 1-1074.  Keeping  false  books  is  a 
misdemeanor,  §  1075.  Corporation  must  post  at  its  principal  office,  for 
public  inspection,  the  by-laws,  names  of  officers,  capital  paid  in,  and 
indebtedness,  etc.,  §§  1076,  1077.'  Non-user  for  two  years  forfeits 
charter,  §  1079.*  Execution  against  the  corporation  may  reach  property 
of  stockholders  to  extent  of  their  unpaid  subscriptions,  §  1082.''  But 
only  after  suit  against  them,  in  which  judgment  against  the  corporation 
is  conclusive,  except  as  to  fraud,  §  1084.  Annual  report  to  be  laid 
before  general  assembly,  §  1280.  May  sell  below  par  bonds  convertible 
mto  stock.  May  not  plead  usury.  May  mortgage  all  property,  §  i283.' 
Mortgages  and  deeds  of  trust  may  cover  after  acquired  property,  §1284. 

Preferred  stock  may  be  issued  on  a  two-thirds  vote  of  all  stock» 
but  not  to  exceed  $10,000  per  mile,  and  entitled  to  dividends  not  ex- 
ceeding eight  per  cent.  §  1286.,  May  be  convertible  into  common 
stock,  §  1287.  Foreign  railroad  companies  are  given  all  the  piivileges 
of  domestic  companies  upon  filing  copy  of  charter,  etc.,  ch.  128,  Laws 
1880,  Rev.  Code  1888,  p.  482.  On  abandonment  of  right  of  way 
another  corporation  may  use  it  or  it  reverts  to  the  owner  of  fee.  Rev. 
Code,  §§  1260  1261.*  Any  railroad  without  surplus  may,  in  addition 
to  right  given  by   §  1286  Ja/ra,  with  assent  of  two-thirds  stockholders. 

Cook    un   Stock  and  Stockholders  and    General  Corporation   Law,  chapter  xii.. 
'/Y. ,  chapter  xiii.  */</..  chapter xiii.  */</,,  chapter  xiii. 

'/rf.,  chapter  XXX.  */</.,  chapter  xxxviii.  '/</.,  chapter,  xi. 

*Id.,  chapter  xU.  *Id.,  chapter  xli. 


■-4r* 


■BB 


It 
1 


83 

alities  shall  not 

Art.  II.  §3. 
may  incorporate 
Articles  of  in  :or- 
Iness  which  must 
hall  not  apply  to 
estate  securities, 
be  to  extent  of 
e  to  be  filed  and 
ended,  §  1065, 
prior  to  lapse  of 
vide  otherwise,  § 
porating  act  ren- 
3n  does  not  apply 
or  twenty  years, 
the  charter  on  a 
lolders,  §  1069. 
feit  all  privileges 

false  books  is  a 
incipal  office,  for 
tal  paid  in,  and 
ro  years  forfeits 
ly  reach  property 
,s,  §  1082.''  But 
t  the  corporation 
eport  to  be  laid 
3onds  convertible 
Koperty,  §  1283.8 

property,  §1284, 
ite  of  all  stock » 
dividends  not  ex- 
le  into  common 
all  the  privileges 
;.,  ch.  128,  Laws 
;  of  right  of  way 
wner  of  fee,  Rev. 
may,  in  addition 
lirds  stockholders. 

n   Law,  chapter  xii.. 
Vrf, ,  chapter  xiii. 
'/</.,  chapter,  xi. 


33 


IOWA. 


§   11 


and  of  its  bondholders,  issue  ils  preferred  stook  at  par  to  the  amount 
of  its  bonded  indebtedness  and  in  exchange  therefor,  ch.  20,  L.  1874, 
Rev.  Code,  1888,  p.  446.  Sales,  leases,  and  joint  running  arrangements 
authorized  as  between  connecting  lines.  Rev.  Code,  ^  1300. 

(///ra  vires  acts  are  punishable  by  fine  and  imprisonment,  §  1072, 
etc.  Franchise  may  be  sold  on  ex  ;cution  and  the  purchaser  is  invested 
with  all  the  powers  of  the  corporation,  §  1086.  A  single  individual  may 
incorporate  under  this  act,  §  1088.  Foreign  corporations  must  file  ar- 
ticles, authorize  service  on  resident  agent,  and  take  out  permit  as  con- 
dition precedent  to  securing  corporate  privileges,  and  on  penalty  of  fine 
Removal  of  cause  into  United  States  courts,  avoids  corporate  permit, 
c.  76,  L.  1886,  Rev.  Code  1S88,  pp.  373,  374.1 

Municipalities  may  aid  railroads  to  extent  of  five  per  cent  of  assessed 
value  of  the  property  in  the  municipality,  ch.  159,  L.  1884.  Rev.  Code 
1888,  p.  475."''  On  a  three-fourths  vote  of  all  the  slock,  railroads  may- 
unite  or  consolidate  with  lines  connecting  at  the  boundary  of  the  state,. 
Rev.  Code,  §  1275. 

Books  giving  financial  condition  of  railroad  company  to  be  always, 
open  to  inspection  of  stockhoiders.s  Transfers  of  railroad  stock,  regis- 
tered out  of  the  state,  valid  only  after  registry  in  the  state.  Certain' 
officers  must  reside  in  the  state,  §  i279.'»  A  railroad  commissioner  is 
given  power  to  reduce  rates  and  enforce  such  reduction  through  the 
courts,  pp.  466-467,  ch.  77,  L.  1878, 

Banks. — Five  or  more  persons  of  full  age,  a  majority  being  citizens 
of  the  state,  may  incorporate  as  a  savings  bank,  by  executing  and  filing 
prescribed  articles  and  affidavits,  and  publishing  prescribed  notice. 
Paid-up  capital  shall  not  be  less  than  $io,ooo  in  towns  of  less  than 
10,000,  nor  less  than  $50,000  in  larger  towns.  Directors  (five  to  nine) 
must  all  be  shareholders,  and  citizens  of  the  state,  and  shall  receive  no 
compensation.  May  require  sixty  days  written  notice  of  withdrawal  of 
deposits,  and  may  close  account  on  written  notice.  May  hold  real  estate 
for  business  and  to  secure  debts.  No  stock  shall  be  issued  until  fully 
paid  up.  Shareholders  are  individually  liable  to  an  amount,  in  addition 
to  stock  held,  equal  to  their  shares  so  held,  and  no  transfer  shall  affect 
this  liability  for  a  period  of  six^months  thereafter.  Total  liabilities  to  one 
person  or  company  shall  not  exceed  twenty  per  cent  of  capital.  Quarterly 
statements  to  be  made.  Making  false  statements  is  felony.  Paid-up 
capital  is  taxable  as  other  property;  but  franchise,  savings  and  deposits, 
and  mortgages  and  other  securities  are  exempt.  C  apital  stock  may  be 
increased,  ch.  60,  L.  1874,  Rev.  Code  1888,  pp.  598-606.    Banking  com- 

'Cook  on  Stock  and  Stockholders,  and  General  Corporation  Law,  chapter   xli. 
Vrf.,  chapter  vi.  '/rf. ,  chapter  xxx.  <//.,  chapter  xxxvii. 


wmimm 


mmm 


§12 


KANSAS. 


84 


panics  not  savings  banks,  organized  under  general  incorporation  laws, 
shall  include  word  "state"  in  their  name,  ch.  72,  L.  1886.  Stock- 
holders in  banks  are  liable  to  extent  of  par  value  of  stock,  in  addition 
to  subscription  price,  ch.  208,  L.  1880,  Rev.  Code  1888,  p.  606. 

TaxatIon,_For  filing    certificate     of     incorporation,   $5,    ch.    125, 
L.  1886,  Rev,  Code,  p.  1205.     Shares  of  stock  are  taxed  at  their  actual 
value.  Rev,  code  1888,  §  813.      Manufacturing  corporations  are  taxed 
on  their  tangible  realiy  and  personalty.      Shares  of  siock   are  then  ex- 
empt, ch.  57,  L.  1880,  Rev.  Code  1888,  p.  273.      National  bank   stock 
is  taxed,  §  818,     Railways  are  assessed  by  the  executive  council  on  en- 
tire r'operty  ,  and  the  gross  earnings  per  mile  is  considered  in  fixing  the 
valuation.     The  valuation  is  then  apportioned  among  the  municipalities 
through  which  they  run,  and  each  taxes  its  proportion,  §§  1317-1322. 
All  property  of  banks  and  domestic  or  foreign  corporations  is  taxable, 
8  801.       All  real  estate  of  r.iilroads  not  used  exclusively  in  operation  of 
lines  is  taxable  the  same  as  individual  really,  §  808,    Property  and  fran- 
chise of  telegraph  and  express  companies  taxable  same  as  individual 
property,  §  811,     Stock  of  corporations  shall  be  assessed  at  cash  value, 
§  813,     National  l)ank  stock  is  taxed  to  the  owner  where  the  bank  is 
located,  and  not  elsewhere,  §  818. 

§  13.  •  KANSAS.--ConBtltutlonal  ProYisions.— All  property  of  banks 
shall  be  taxed,  Art.  XL,  §  2.  "The  state  shall  never  be  a  party  in 
carrying  on  any  works  of  internal  improvement,"  Art.  XI.,  §  8.  Cor- 
porations shall  not  be  created  by  special  act.  Art.  XII.,  §  i.  Stock- 
holders in  all  but  railroad  corporations  are  liable  "  to  an  additional 
amount  equal  to  the  stock  owned  by  each  stockholder,"  Art.  XII.,  §  2. 
No  banking  law  shall  be  in  force  until  approved  by  a  majority  of  the 
electors  at  a  general  state  election.  Art.  XIII.,  §  8.  The  state  shall 
not  be  a  stockholder  in  any  banking  institution.  Art.  XIII.,  §  5. 

Miscellaneous  Corporations.— Five  or  more  may  incorporate  for  v^.ri- 
ous  purposes  specified  in  the  statutes,  Com.  Laws  1885,  p.  210.     Three 
of  the  incorporators  must  be  citizens  of  the  state.      Charter  must  be 
subscribed  and  acknowledged  and  filed  with  secretary  of  state  who  is- 
gues  certified  copy,  p.  212.     Corporation  may  borrow  money,  but  not  in 
excess  of  its  capital  stock.     May  increase  capital  stock  to  amount  not 
exceeding  three  times  authorized  capital,  amended  ch.  117,  L.  1887,  Com. 
L.,  p.  213.    Directors  may  make  by-laws,  which,  however, 'may  be  altered 
by  vote  of  stockholders,  p.  214.     Must  makt  report  on  demand  of  one- 
third  of   stockholders,  and  all  the  corporate   records  and   books   are 
open  to  the  inspection  of  stockholders.     Detailed  annual  statement  to 
be  filed  with  secretary  of  state,  Id        Person  claiming  right  to  vote 


■MR 


84 

rporation  laws, 
1886.  Stock- 
)ck,  in  addition 
p.  606. 

,  $5,   ch.    125, 
I  at  their  actual 
tions  are  taxed 
;k   are  then  ex- 
nal  bank   stock 
:  council  on  en- 
red  in  fixing  the 
le  municipalities 
,  §§  1317-1322. 
tions  is  taxable, 
r  in  operation  of 
jperty  and  f  ran- 
le  as  individual 
;d  at  cash  value, 
lere  the  bank  is 


roperty  of  banks 
;r  be  a  party  in 

XI.,  §  8.  Cor- 
II.,  §  I.  Stock- 
to  an  additional 
;•  Art.  XII.,  §2. 
a  majority  of  the 

The  state  shall 

nil.,  §5. 

orporate  for  v^.vi- 
5,  p.  210.     Three 
Charter  must  be 
of  state  who  is- 
money,  but  not  in 
ck  to  amount  not 
17,  L,  1887,  Com. 
er,*may  be  altered 
n  demand  of  one- 
Is  and   books  are 
nual  statement  to 
ning  right  to  vote 


35 


KANSAS. 


§  12 


must  have  appeared  on  stock  book  for  thirty  days  previous  to  election, 
§  215.  No  stcck  to  be  transferred  until  assessments  are  paid.  Cumu- 
lative voting  is  provided  for,  Id.  Must  keep  a  general  office  within  the 
state.  Three  of  the  directors  must  be  citizens  and  residents  of  the 
state,  §  216.  Stockholder's  liability  prescribed  by  the  constitution  may 
be  enforced  by  the  same  execution  that  is  returned  unsatisfied  against 
the  corporation,  "but  no  execution  shall  issue  against  any  stockhold- 
ers, except  upon  an  order  of  he  court  in  which  the  action,  suit  or 
•other  proceeding  shall  have  him  brought  or  instituted,  made  upon  mo- 
tion, in  open  court  after  reasonable  notice  in  writing  to  the  person  or 
persons  sought  to  he  charged;  and  upon  such  motion,  such  court  may 
order  execution  to  issue,  accordingly,  or  the  plaintiff  in  the  execution 
may  proceed  by  action  to  charge  the  stockholders  with  the  amount  of 
his  judgment,"  Id.,  p.  216.  The  treasurer's  office  and  corporate  funds 
sha  1  be  kept  within  the  state,  p.  217.  The  name  of  the  corporation  shall 
indicate  the  character  of  the  business.  The  charter  may  be  amended, 
ch.  62,  Laws  1886.  Corporations  may  borrow  money  and  give  bonds 
or  notes  to  the  extent  of  their  capital  stock,  ch.  109,  L,  1889.  "j  rus^ts 
■are  declared  unlawful,  ch.  257,  L.  1889. 

Railways. — May  be  incorporated  under  the  above  mentioned  law, 
su/>ra.  Certificates  of  stock  issued  shall  be  valid  and  binding  as 
against  the  corporation,  unless  an  action  to  cancel  the  same  shall  be 
brought  within  two  years,  p;  221,  One  railroad  may  guarantee  ctock, 
consolidate,  lease,  etc.,  with  connecting  lines,  ch.  134,  Laws  iSS6, 
Amended  by  ch.  186.  L.  1887.  A  Kansas  railroad  may  extend  into  other 
states  and  may  lease  or  purchase  the  road,  and  buy  or  guarantee  the 
stocks  and  bonds  of  continuous  railroads  in  another  state,  L.  1887,  ch. 
181.  Counties  and  towns  may  aid  railroads.  Two-fifths  of  taxpayers 
may  petition  for  election.  Railroad  to  give  a  bond  to  cover  the  ex- 
penses. In  no  case  shall  the  whole  amount  exceed  $2,000  per  mile,  L. 
1887,  ch.  183.  Foreign  railroads  must  file  a  copy  of  charter  and 
authorization  of  service  on  agents  in  the  state  before  purchasing  o* 
leasing  Kansas  railroads,  and  no  such  foreign  railroad  shall  remove 
caus-s  to  the  Federal  courts,  ch.  186,  L..1887.  Foreign  railroads 
operating  in  this  state  are  not  required  to  have  any  resident  directors, 
nor  to  maintain  their  principal  office  w  the  state,  ch.  135,  L.  1886. 
Consolidation  of  connecting  lines  authorised  on  two-thirds  vote  of  all 
the  stock,  ch.  197,  L.  1889.  A  railroad  commissioner  is  given  power 
to  regulate  rates,  p.  703.  The  orders  of  the  coinmission  must  be 
obeyed,  ch.  192,  L.  :88'/. 

Banks.— Five  or  more  r:ay  organize  a  savings  bank,  having  a  capital 
stock  from  $50,000  to  $500,000,  Com.  Laws,  p.  229.  Must  semi- 
annually  publish  and  file  sworn  statement,  Id.  p.  230. 


' 


»i 


'tiit' 


§  13 


KENTUCKY. 


86 


Taxatloii.-Sbares  of  stock,  capital  stock,  undivided  profits,  and  all 
other  corporate  assets  are  taxed,  p.  944-  See  also  §  10,  p.  947-  The  capital 
stock  is  assessed  at  its  true  value  in  money,  less  the  value  of  corporate 
realty  and  personalty  in  the  state.  Shares  of  stock  in  capital  stock  so 
taxed,  are  not  taxed,  §  12,  p.  9481.  Shares  of  stock  in  banks  are  taxed 
Id.  p.  950.  Railways  are  assessed  by  a  state  board  and  the  assessment 
is  apportioned  to  the  counties  through  which  the  railroad  runs,  p.  95. 
Fees  of  secretary  of  state  are  nominal,  Com.  Laws  1885,  p.  897. 

8  13.  KENTUCKY.  Constitutional  Provisions.— There  are  none,  but 
by  Art.  XIll,,  §  i,  it  is  provided  "  that  no  man,  or  set  of  men,  are  en. 
titled  to  exclusive,  separate  public  emolument-,  or  privileges  from  the 
community  but  in  consideration  of  public  services." 

Miscellaneous  Corporations  and  Railroads.— Any  number   may  incor- 
porate for  any  lawful  business,  except  banking  and    insurance,  and    for 
thS  construction  of  railroads.  Articles  to  be  signed,  acknowledged  and  filed 
with  clerk  of  county  court.   Internal  improvement  companies  shall  also  file 
the  same  with  the  secretary  of  state.  Gen.  St.  1887,  p.  763.  Such  article 
must  specify  limit  of  indebtedness  not  to  exceed  two-thirds  of  the  capital 
stock      Must  state  whether   stockholders  are  to   be  personally   liable. 
Notice  must  be  published  four  weeks.     Same   formalities  necessary  for 
alterations.  Id.  p.  764.     Transfer  of  stock  valid  only   between  parties 
until  recorded.     Stock  books  to  be  open   for  inspection.     Corporation 
ceases  to  exist  after  five  years  non-user.  Id.   p.  765.     Any   corporation 
may  issue  preferred  stock  which  must  appe-r  to  be  such  on  its  face.  Id. 
pp    773    774-  Stockholders  cannot  escape  liability  for  unpaid  subscrip- 
tions by  transfer  to  defraud  creditors  and  an  execution  against  the  company 
may  to  that  extent  be  levied  upon  their  private  property.  Id.  p,  766.  In  pro- 
ceedings the  courts  may  order  the  production  of  the  books  upon  motion 
of  either  party.  Id.     Only  paid-up  stock  is  to  vote  at  elections,  Id.  p. 
769      An  election  due  and  not  called  may  be  ordered  by  court  on  ap- 
plication  of  stockholders  owning  ten  shares.  Id.  All  charters  are  subject 
to  legislative  repeal  or  amendment.  Id.  p.  861.     Purchasers  of  railroads 
at  judicial  sale  may  become  a  rorporation,   Id.  p.    766.     For  act  con- 
cerning judicial  sale  of    railroad,   see   Id.   77°-     Foreign  railroad  cor- 
porations operating  within  the  state  must  within  sixty  days  file  in  each 
county  an  agreement  to  accept  service  thrr-gh  its  agents  and  to   have 
all  suits  with  citizens  tried  in  the  state  courts.  Failure  to  comply  and  re- 
moving a  suit  to  Federal  court  annuls  all  contracts  thereafter  made  and 
constitutes  a  misdemeanor,   Id.   pp.  656,   657.     Election  of  railroad 
officers  shall  be  within  ti.e  state  and  must  be  advertised.     Only  paid-up 
stock  is  to  vote.     Court  may  call  election  upon  application  of  holders  of 


8ft 

)rofits,  and  all 
^7.  The  capital 
e  of  corporate 
apital  stock  so 
lanks  are  taxed 
the  assessment 
d  runs,  p.  9S- 
p.  897. 

;  are  none,  but 
■  men,  are  en. 
leges  from  the 

ber  may  incor- 
rance,  and   for 
ledged  and  filed 
les  shall  also  file 
•3.  Such  article 
is  of  the  capital 
rsonally   liable. 
;s  necessary  for 
between  parties 
1.     Corporation 
ny  corporation 
I  on  its  face.  Id. 
mpaid  subscrip- 
nst  the  company 
i.  p,  766.  In  pro- 
)ks  upon  motion 
elections,  Id.  p. 
>y  court  on  ap- 
rters  are  subject 
sers  of  railroads 
For  act  con- 
jn  railroad  cor- 
lays  file  in  each. 
Its  and  to  have 
)  comply  and  re- 
reafter  made  and 
;tion  of  railroad 
1.     Only  paid-up 
ion  of  holders  of 


87 


LOUISIANA. 


§  14 


ten  shares,  Id.  p.  769.  Officers  of  railroads  receiving  municipal  aid 
must  give  a  bond  for  the  proper  application  thereof.  Annual  balance  sheet 
must  be  furnished  and  suit  rnay  be  brought  for  any  falsity.  Misap- 
propriation of  aid  is  a  felony.  Id.  pp.  1215,  1216.  The  governor  appoints 
aboard  of  three  railroad  commissioners.  Id.  p.  1023.  To  them  every 
railroad  renders  an  annual  statement,  p.  1025.  All  railroads  are  exempt 
from  all  taxation  for  five  years  from  date  of  beginning  of  construction, 
Id.  p.  1029. 

RankM.— All  banks  doing  business  under  the  statelaws  are  to  pubish 
and  file  semi-annual  statements.  Id.  p,  771,   772. 

Taxation. — Fees  for  recording  the  charter  are  one  dollar  and  ten  cents 
a  hundred  words,  p.  766.  Shares  of  stock  in  banks,  and  all  other  corpor- 
ations required  by  law  to  be  taxed  on  their  capital  stock,  are  taxed  seventy- 
five  cents  on  every  share  of  fioo,  and  the  corporation  pays  on  its  surplus 
over  ten  percent  of  the  capital  slock  a  tax  at  the  same  rate  as  on  realty, 
which  shall  be  in  full  of  all  tax — state,  county  and  municipal.  Real 
estate  taxed  separately  for  county  and  municipal  purposes.  Deduction 
if  surplus  invested  in  United  States  bonds,  pp.  1039-1046.  Rail- 
roads to  report  to  state  auditor,  who  assesses  total  value  thereof  and 
apportions  it  for  taxation  to  the  municipalities  through  which  the  rail- 
road  runs,  pp.  1042,  etc.  Property  of  al!  corporations,  unless  otherwise 
provided,  is  to  be  assessed  and  taxed  the  same  as  property  of  individuals, 
p.  1047.  (See  98  S.W.  Rep.,  516,  709.)  Railroads  are  exempt  from  tax- 
ation for  five  years  after  beginning  construction.  Acts  1883-4,  p.  195. 
Telegraph  companies  pay  one  dollar  per  mile  for  the  line  of  poles  and 
the  first  wire,  and  fifty  cents  per  mile  for  each  additional  wire.  Telephone 
companies  pay  one-quarter  of  one  per  cent  of  gross  receipts.  Express 
•companies  pay  annual  license  tax  of  $500  for  less  than  one  hundred 
miles  and  $1,000  for  more,  Id.  p.  1046. 

§  14.  LOUISIANA.— Constitutional  ProvTsloni.— Corporations  shall 
not  be  created  by  special  acts.  Art.  XLVI.,  Constitution  of  1879.  Nor 
shall  special  or  exclusive  rights,  privileges  or  immunities  be  granted  to 
them,  M  Neither  the  state  nor  municipalities  shall  aid,  etc.,  any  cor- 
poration, .\rt.  LVI.,  cp.  Art.  CCXLII.  j«^.  Power  to  tax  corporations 
shall  not  be  contracted  away.  Art.  CCV.  Foreign  corporations  may  be 
licensed  to  do  business  in  the  state,  Art.  CCXVII.  But  they  must  have  a 
place  of  business  and  an  authorized  agent  in  the  state,  Art.  CCXXXVI. 
Fictitious  stock  and  bonds  are  void,  and  the  corporation  issuing 
them  shall  forfeit  its  charter,  Art.  CCXXXVIII.  Bank  officer,  re- 
ceiving deposits,  etc.,  after  he  knows  the  bank  is  insolvent  or  failing,  is 
guilty  of  a  crime,  Art.  CCXLI.      Municipalities  may  aid   railroads  on 


§  14 


LOUISIANA. 


3$ 


majority  vote  of  property  taxpayers  in  numbers  and  in  value,  upon 
authorization  by  the  general  assembly.  Tax  not  to  exceed  five  mills  per 
annum,  nor  exist  longer  than  ten  years.  Art.  CCXLI'.  All  corporations, 
must-keep  a  stock  book  and  statement  of  assets  and  liabilities  in  ihe 
state,  open  to  public  inspection.  Art.  CCXLV.  Consolidations  with 
foreign  corporations  shall  not  make  a  domestic  corporation  foreign,  and 
in  no  case  shall  any  consolidation  take  place  without  sixty  days'  notice  ta 
all  stockholders.  Art.  CC\LVI. 

"  The  exercise  of  tiic  police  power  of  the  state  shall  never  be 
abridged  nor  so  construed  as  to  permit  corporations  to  conduct  their 
business  in  such  manner  as  to  infringe  the  equal  rights  of  individual,  or 
the  general  well-being  of  the  state,"  Art.  CCXXXV. 

Corporations  cannot  hold  real  estate  longer  than  ten  years,  except 
such  as  is  necessary  for  legitimate  business,  Art.  CCXXXVII. 

Stock  may  only  be  increased  by  majority  vote  at  a  meeting  noticed 
thirty  days,  Art.  CCXXXIX. 

"  The  monopoly  features  in  the  charter  of  any  corporation  now  ex- 
isting in  the  state,  save  such  as  may  be  contained  in  the  charter  of  rail- 
road companies,  are  hereby  abolished,"  Art.  CCLVIII. 

MiHC(>Uaiieoii8  Corporations. — Six  or  more  may  incorporate  for  rail- 
road, manufacturing,  and  generally  for  "all  works  of  public  utility  and 
advantage,"  except  "  in  mercantile  or  in  commission  brokerage,  stock- 
jobbing, exchange  or  banking  business  of  any  kind,"  Rev.  L.  2d  ed., 
1884,  §  683.  May  incorporate  to  exist  ninety-nine  years,  §  684.  Char- 
ter must  contain  the  usual  requisites  and  be  recorded  and  published  in 
the  place  chosen  for  the  domicile  of  the  corporation,  §§  685,  686. 
Charter  may  be  amended.  §  687.  Railroad  cannot  be  put  through  city 
or  town  without  consent  of  municipal  authorities,  §  689.  Stockholders, 
not  liable  beyond  unpaid  subscriptions,  nor  do  informalities  in  incorpo- 
ration render  them  otherwise  liable,  §  690.  Railroads  and  other  corpora- 
tions may  borrow  money  on  mortgage  of  property  and  franchises  ;  such 
mortgage  need  be  recorded  only  in  the  parish  where  principal  office  is 
located.  Right  may  be  granted  to  convert  bonds  into  capital  stock 
within  ten  years,  but  with  restrictions  as  to  increase  of  the  capital  stock,  §|^ 
692,  693,  and  see  §§  726,  727.  Municipalities  may,  with  consent  of  a  ma- 
jority vote  at  a  special  election,  subscribe  to  the  stock  of  internal  improve- 
ment companies.  "The  stock  subscribed  shall  not  belong  to  nor  be  admin- 
istered by  the  parish  or  municipal  corporation  by  which  the  subscription 
shall  be  made,  but  shall  belong  to  the  taxpayers  who  shall  have  paid 
therefor ;  and  the  tax  receipt  of  each  taxpayer  shall  entitle  him  to  a. 
certificate  transferable  by  delivery  from  the  corporation  to  which  sub- 
scription has  been  made,  for  an  amount  equal  to  the  amount  of  his  tax 


■WP 


n 


d» 


89 


MAINE. 


S    15 


in  value,  upon 
led  five  mills  pe/ 
All  corporation* 
labilities  in  ihe 
isolidations  with 
tion  foreign,  and 
;y  days'  notice  tO' 

shall  never  be 
o  conduct  their 
of  individual,  or 

en  years,  except 
XXVII. 
meeting  noticed 

•poration  now  ex- 
le  charter  of  rail- 
i. 

corporate  for  rail- 
public  utility  and 
brokerage,  stock- 
Rev.  L.   2d  ed., 
irs,  §  684.    Char- 
and  published  in 
ion,  §§  685,  686. 
:  put  through  city 
89.     Stockholders 
lalities  in  incorpo- 
and  other  corpora- 
franchises  ;   such 
principal  office  i& 
into  capital   stock 
le  capital  stock,  §§^ 
:h  consent  of  a  ma- 
if  internal  improve- 
ngtonorbeadmin- 
:h  the  subscription 

10  shall  have  paid 

11  entitle  him  to  a 
ion  to  which  sub- 
amount  of  his  tax 


paid,"  gg  71 1-7 14.  State  may  take  one-fifth  of  stock  of  domestic  rail- 
road company,  if  authorized  by  special  law,  ^  715.  Coupon  bonds  at 
six  per  cent  payable  in  forty  years  shall  be  issued  therefor,  and  shall  be 
transferable  by  endorsement  of  secretary  of  the  company,  g  716.  Such 
bonds  to  be  issued  only  in  proportion  (one-fourth)  to  the  other  stock 
actually  paid  in,  §  717.  All  such  companies  to  report  annually  to 
legislature,  §  724.  Meetings  of  the  stockholders  and  of  directors  must 
be  held  within  the  state,  §  741.  Capital  may  vary  from  $5,000  to 
$1,000,000  when  the  purpose  is  mining  or  manufacturing,  Laws  1882, 
p.  162. 

Tftxatlon.— By  l^ws  of  1886,  p.  132,  the  old  methods  of  taxing  cor- 
porations were  changed.  The  corporate  realty  and  personalty  are  taxed 
the  same  as  that  of  an  individual.  The  capital  stock  is  not  taxed,  but 
all  shares  of  stock  are  taxed  and  the  corporation  is  obliged  to  pay 
such  tax  and  collect  it  from  the  stockholders.  Bylaws  i88i,  p.  5^;,  a 
tax  or  license  fee  is  laid  on  corporations  or  individuals  pursuing  any 
business.     The  fee  is  graded  according  to  gross  annual  receipts. 

§  15.  MAINE.  Constitutional  Provisions.— Corporations  are  to  be 
formed  tmder  general  laws  unless  the  object  of  the  corporation  cannot 
otherwise  be  obtained.  Art.  IV.,  §  14. 

Miscellaneons  Corporations.— Three  or  more  may  incorporate  here- 
under for  any  lawful  business,  except  banking,  insurance,  construction 
and  operation  of  railroads  or  aiding  in  construction,  trust  companies, 
telegraph  or  telephone  business,  R.  S.  1884,  p.  439.  Capital  stock  may 
be  from  $1,000  to  $2,000,000,  Id.  Fee  for  filing  certificate  $10 
(amended  by  ch.  90,  Acts  1887,  adding  $10  when  capital  is  less,  and  $50 
when  more  than  $10,000).  Attorney-general  certifies  to  legality  of  cor- 
porations and  to  regularity  of  certificate,  id.  p.  440.  Charters  may  be 
amended,  ch.  361,  Laws    1885. 

Railroad  Corporations.— Majority  of  incorporators  and  directors  named 
in  certificate  must  be  citizens  of  the  state,  R.  S.  1884,  pp.  467-468. 
Articles  not  to  be  filed  until  full  capital  -s  subscribed  and  five  per  cent 
paid  thereon  in  cash.  Id.  468.  Articles  must  be  approved  by  railroad 
commissioners  and  recorded  with  secretary  of  state,  who  issues  certificate 
<n  prescribed  form  and  takes  fee  of  $20,  Id.  468.  Any  stockholder  at 
any  meeting  may  call  for  stock  vote.  Id.  470.  A  lease  or  grant  of  its 
road  or  any  part  is  illegal,  unless  authorized  by  the  legislature.  Id.  480. 
Bonds  may  be  issued  and  sold  below  par,  Id.  Trustees  named  in  rail- 
road mortgage  may  be  elected  by  bondholders  by  ballot  to  fill  vacancies. 
If  bonds  or  coupons  are  overdue,  trustees  may  take  possession,  operate 
the    road,  and    return   it  when  overdue  liabilities  are  paid,   Id.   484. 


§  15 


MAINE. 


40 


if. 


Foreclosure  made  on  application  of  one-third  of  bondholders.  Fore- 
closure is  for  their  benefit,  constitutes  them  a  corporation,  and  trustees 
shall  convey  to  it.  Id.  p.  485.  Railroads  may  by  two-thirds  vote  of  stock- 
holders aid  construction  of  branches  or  connecting  lines,  oh.  301,  T,aws 
1885.  A  railroad  commission  is  given  power  to  reduce  rates,  and  to  ap- 
prove or  disapprove  of  the  building  of  a  new  railroad,  R.  S.  pp.  469 
470.     Kailroad  commissioners  may  revive  lapsed  charters,  cli.  96,  Acts 

1887. 

Banks.— Directors   must  be  stockholders,  citizens  and  residents  of  the 
state,  and  majority   must   be  residents   of  the  county.     Two  partners 
may  not  be  directors  nor  one  person  director  in   two  hanks.    Id.  p.  412. 
One  share  has  one  vote,  and   every  two  additional  shares  one  vote,  but 
no  one  can  cast  more  than  twenty  votes.  Cashier  cannot  be  director,  nor 
vote  for  directors.  Id.  p.  413.  No  loans  to  be  made  on  pledge  of  the  bank's 
own  stock;  no  loan  to  stockholder  whose  shares  are  not  paid  up;   all  dues 
.-from  all  directors  shall  not  exceed  one-third  the  capital;  all  dues  from 
one  director  not  to  exceed  eight  per  cent  of  capital.     All  bank  property 
subject  to  attachment.  Id.  414.     Bank  may  hold  real  estate  requisite  for 
business,  but  shall  not  exceed  twelve  per  cent  of   capital,   exclusive  of 
real  estate  taken  or  held  as  security  for  or  in  payment  of  debts.     Debts 
and  dues  of  banks  are  limited  to  twice  the  amount  of  capital  with  certain 
exclusions,  Id.  414.  Directors  are  liable  for  excess  of  debts.  Id.  417.  State 
may  take  stock  in  any  b^.nk  and  appoint  additional   director;  state   may 
require  loan  of  any  bank,  Id.  417.     No  person  can   own  over  one-fifth 
of  the  capital  stock.  Id.  414.     Stockholders  are  liable  to  the  amount  of 
their  stock  to  make  good  any  deficiency  caused  by   mismanagement  of 
directors.  Id.  p.  418.  Thirteen  or  more  may  organize  a  savings  bank  or 
trust  and  loan  association;  three-fourths   must  reside   in  county;  must 
publish  intention  to  organize;  send  certificate  to  examiner  and  secretary 
of  state;  not  more  than  two  of  the  five  trustees  shall   be  national    bank 
directors;    must   have  thirty   members;  no    single   deposit   to   exceed 
$2,000;  may  have  suitable  building  not  exceeding  $100,000  in   value; 
investments    in   stocks  and   mortgages  restricted.  Id.  pp.  426,  et  seq. 
am'd  Acts  1887,  ch.  142. 

General  Provisions.— Justice  may  call  meeting  on  written  applica- 
tion of  three  members.  Id.  p.  400.  I'roxy  may  be  given  for  one  meet- 
ing not  more  than  thirty  days  before  it  is  held.  No  one  to  cast  more 
votes  than  allowed  by  charter  or  by-la^vs,  Id.  401.  When  capital  is 
impaired,  stock  may  be  reduced  by  two-thirds  stock  vote,  but  dissatisfied 
stockholder  may  move  in  equity  to  annul  proceedings  within  thirty  days, 
Id.  401.  Foreign  corporations  may  sue  and  be  sued  and  property  be 
attached  as  that  of  non-resident  individuals,  Id.  402.    Corporations  must 


■IIMMil        \  [JM 


40 

dhoklers.  Fore- 
tion,  and  trustees 
tls  vote  of  stock- 
es,  ch.  301,  T,aws 
:  rates,  and  to  ap- 
R.  S.  pp.  469 
ters,cli.  96,  Acts 

d  residents  of  the 
r.     Two  partners 
anks,    Id.  p.  412. 
ires  one  vote,  but 
ut  be  director,  nor 
edge  of  the  bank's 
paid  up;   all  dues 
tal;  all  dues  from 
All  bank  property 
;state  requisite  for 
ital,   exclusive  of 
:  of  debts.     Debts 
apital  with  certain 
;bts.  Id.  417.  State 
rector;  state   may 
wn  over  one-fifth 
i  to  the  amount  of 
lismanagement  of 
a  savings  bank  or 
in  county;  must 
liner  and  secretary 
be  national    bank 
jeposit  to   exceed 
100,000  in   value; 
d.  pp.  426,  et  seq. 

in  written  applica- 
iven  for  one  meet- 
3  one  to  cast  more 
,  When  capital  is 
ote,  but  dissatisfied 
1  within  thirty  days, 
;d  and  property  be 
Corporations  must 


th 


41 


MARYLAND. 


§   16 


keep  within  the  state  an  office  containing  "their  records  and  books, 
which,  at  seasonable  hours,  shall  be  open  to  the  inspection  of  jiersons 
interested."  General  power  of  attorney  may  take  place  of  proxy,  p.  401. 
Corporate  officers  must  make  report  to  state  of  resiliences  of  stockhold- 
ers, p.  404.  Stockholders  are  not  liable  beyond  the  unpaid  subscription, 
except  in  the  case  of  banks,  but  if  execution  against  corporation  is  re- 
turned unsatisfied,  levy  may  be  on  any  stockholder's  shares  of  stock. 
He  has  recourse  against  the  corporation.  Id.  405.  Corporations  not 
doing  l)usine.ss  in  the  state  must  have  a  clerk  in  the  state,  an  office  in 
the  state,  the  corporate  records  and  a  list  of  stockholders  opento  inspec- 
tion in  the  state,  all  under  penalty  of  forfeiture  of  charter,  ch.  263  L. 
1889. 

Taxation. — Shares  of  stock  of  both  domestic  and  foreign  corpora- 
tions are  taxed,  p.  127.  Machinery  and  real  estate  taxed.  Proportionate 
part  thereof  is  deducted  from  tax  on  shares.  Id.  p.  129.  Realty  and  per- 
sonalty of  manufacturing  and  mining  corporations  are  taxed.  The 
shares  of  stock  are  not  taxed,  p.  132.  Bank  stock  is  taxed  where  hold 
ers  reside,  if  in  the  state  ;  if  out  of  state,  is  taxed  at  location  of  bank, 
p.  ^i^.  Railroads  are  taxed  one-quarter  of  one  per  cent  of  gross 
receipts  when  such  receipts  are  $2,250  a  mile  or  less  ;  one-half  of  one 
per  cent  if  $3,000  or  less  ;  and  increases  one-ijuarter  of  one  per  cent  for 
every  $750  until  tax  is  three  and  one-quarter  per  cent.  Tax  is  divided 
among  municipalities  where  the  stock  is  held  at  rate  of  one  per  cent  on 
market  value  of  the  stock,  p.  136.  Railroad  lands  and  buildings,  aside 
from  track,  are  taxed  where  they  lie,  p.  126.  Foreign  surety  companies 
to  pay  annual  license  fee  of  twenty  dollars  and  one  dollar  for  each 
agent's  certificate.  They  shall  also  pay  annual  tax  of  two  per  cent  on 
excess  of  premiums  over  paid  losses.  Acts  of  1887,  p.  66.  Express  com- 
panies to  procure  annual  license  and  pay  state  tax  of  three-quarters  of 
one  per  cent  of  gross  receipts  in  lieu  of  local  taxation.  Municipal  tax 
on  real  estate  to  be  deducted  from  state  tax,  Acts  1887,  pp.  56,  57. 
Savings  banks  taxed  three-quarters  of  one  per  cent  on  deposits  after 
deducting  real  estate  and  exempted  securities,  R.  S.,  p.  14'j,  and  Acts 
1887,  p.  58. 

§  16.  MARYLAND.  Constitntional  Provisions.— Stockholders  in 
banks  are  to  be  liable  to  the  amount  of  their  stock,  Art.  III.,  §  39. 
Incorporations  must  be  under  general  laws,  except  where  there  is  no 
general  law  of  the  same  general  character  as  the  proposed  corporation. 
All  charters  are  subject  to  repeal  or  alteration.     Id.  §  48. 

Higcellaneons  Corporations. — Five  or  more  citizens  of  the  United 
States,  and  a  majority  citizens  of  Maryland,  may  incorporate  for  various 


8  i« 


MARYLAND. 


49 


III 


fit 


specilied  purposes,  provided,  generally,  that  the  business  is  to  be  car- 
ried on  in  the  state,  (;en.  Laws  1888,  pp.  289-295.    Court  certifies  that 
certilicatc  of  incorporation  conforms  to  the  law.  Id.  319,  which  deter- 
mination is  conclusive,  Id.  295.    Fees  are  nominal,  Id.  297.    The  stock- 
holders or  members  of  the  corporation  may,  at  any  general   meeting, 
make  by-laws,  which  shall  not  be  rescinded  by  the  directors,  managers, 
or  trustees.  Id.  p.  298.     Provision  may  be  made  by  charter  or  by-laws 
for  minority  representation  in  elections  of  board,  p.  299.     Companies 
incorporated  under  general  act  for  same  purposes,  in  whole  or  in  part, 
may  consolidate  if  capital  of  both  is  paid  up  and  majority  of  stock- 
holders in  each  assent,  p.  293.     Directors  to  be  citizens  of  United  State* 
and  majority  to  be  residents  of  the  state,  p.  299.     Payment  in  property 
on  subscription  allowed  at  valuation  agreed  upon  if  stockholders  author- 
ize such,  p.  300.     Capital  stock  to  be  paid  in  four  annual  equal  pay- 
ments, p.  301.     No  liability  beyond  the  unpaid  subscription,   Id.     No 
.  loan  of  money  to  stockholder  is  legal.     Person  owning  five  per  cent  of 
capital  stock  may  require  statement  of  condition  of  corporation,  p.  304. 
Book  containing  names  of  stockholders  always  to  be  open,  p.  304.  Annual 
report  requited  to  be  recorded  at  principal  place  of  business,  p.  305, 
Manufacturing  corporations  may  amend  charter  so  as  to  change  busi- 
ness, p.  342.     Mining  corporations  cannot  hold  over  five  hundred  acres 
of  land.     Capital  stock  not  to  exceed  $3,000,000,  p.  343. 

Railroad  Corporations.— Five  or  more  may  incorporate,  three  to  be 
citizens  of  Maryland,  p.  346.  Consolidation,  aid,  lease  or  purchase  of 
one  connecting  railroad  by  another  allowed,  p  361.  Otfier  consolida- 
tions, etc.,  prohibited  unless  expressly  authorized  by  special  act,  p.  356, 
Banks. — Five  or  more  may  incorporate,  p.  99.  Directors  must  be 
stockholders  and  citizens  of  Maryland,  p.  loi.  Each  share  has  one 
vote  up  to  ten,  then  one  vote  for  every  two  shares  up  to  one  hundred, 
and  one  vote  for  every  five  additional  shares  held  by  one  person.  No 
vote  on  stock  not  owned  for  four  months  previous  to  election.  No 
proxies  to  l)e  given  by  non-residents  of  the  United  States.  Director 
cannot  be  director  in  any  other  bank  in  the  state,  p.  102.  Capital  in 
Baltimore  must  be  $300,000  ;  elsewhere  at  least  $50,000,  p.  100. 
Stockholders  are  liable  to  the  amount  of  their  stock,  p.  109. 

iicncral  Provisions.— All  certificates  of  incorporation  must  be  filed 
wiih  state  tax  commissioners,  p.  1253.  Officers  must  keep  full,  fair 
and  correct  accounts  of  their  transactipns,  which  shall  be  open  at  all 
times  to  the  inspection  of  the  stockholders  or  members.  Meetings  may- 
be called  by  :^  majority  in  interest  of  the  stockholders.  Majority  in  in- 
terest of  stockholders  may  remove  the  president  or  any  director  and 
elect  others  to  fill   the  place,  p.  286.     Majority  of  stock  may  call  a 


--Si 


H 


42 


43 


MASMACHUSRTTS. 


B  IT 


; 


inesH  is  to  be  car- 
!oiirt  certifies  that 
319,  which  (leter- 
297.  The  stock- 
general  meeting, 
rectors,  managers, 
charter  or  by-laws 
299.  Companies 
1  whole  or  in  part, 
majority  of  stock- 
s  of  United  States 
lyment  in  pro|)erty 
x'kholders  aiithor- 
inniiai  equal  pay- 
icription,  Id.  No 
ng  five  per  cent  of 
orporation,  p.  304. 
en,  p.  304.  Annual 
f  business,  p.  305, 
as  to  change  busi- 
five  hundred  acres 

343- 

porate,  three  to  be 
ase  or  purchase  of 
,  Otfier  consolida- 
special  act,  p.  356. 
Directors  must  be 
ich  share  has  one 
jp  to  one  hundred, 
y  one  person.  No 
s  to  election.  No 
I  States.  Director 
3.  102.  Capital  in 
t  $50,000,  p.  100. 
:k,  p.  109. 
:ion  must  be  filed 
ust  keep  full,  fair 
shall  be  open  at  all 
irs.  Meetings  may 
•s.  Majority  in  in- 
any  director  and 
:   stock  mav  call  a 


meeting,  p.  286.  Any  president  or  director  may  be  removed,  p.  2H7, 
On  due  notice,  an  oath  of  stockholdership  may  l)e  required  from  tluise 
voting,  p.  287.  Directors  must  (jualify  under  oath,  |).  288.  Proxies 
must  be  verified.     Id. 

Taxation.— Owners  of  bonds  or  certificates  of  debts  issued  by  corpo- 
rations and  secured  by  mortgages  are  taxed,  p.  1207.  All  other  taxation  is 
by  state  board,  who  assess  all  the  shares  of  stock  at  actual  value,  deduct 
therefrom  assessed  value  of  realty,  and  report  to  various  municipalities 
the  stock  owned  by  its  residents.  Corpoiation  pays  the  tax  and  collects 
from  its  stockholders.  Railroads  are  assessed  on  realty  and  person- 
alty where  they  lie  ;  also  pay  to  the  state  a  tax  of  one-half  of  one  per 
cent  of  gross  receipts  received  within  the  state  :  shares  of  stock  not  then 
taxed,  p.  1256,  ch.  20,  Laws  1880.  All  corporate  realty  is  taxed  where 
it  is  located.  All  shares  of  stock  ownetl  by  residents  are  taxed,  except 
in  railroads  paying  taxes  on  gross  receipts,  p.  1J07,  ch.  122,  Law, 
1880.  State  tax  on  all  shares  of  ctock  is  to  be  paid  by  the  corporation  to^ 
the  state,  pp.  1236,  1254.  Uonds,  evidences  of  debt,  etc.,  owned  by  resi- 
dents or  non-residents  are  taxed,  p.  1238.  Tax  is  on  shares  of  stock 
and  is  paid  by  corporations,  but  deduction  allowed  for  stock  owned  by 
corporation,  p.  1258.  Shares  of  stock  of  all  corporations  incorporated 
by  state  or  located  and  doing  business  in  it,  are  assessed  at  actual  value^ 
p.  1259,  ch.  178,  Laws  1878.  Stock  of  non-residents  assessed  at  princi- 
pal office  of  corpc.ution,  p.  1250.  Before  commencing  business  every 
corporation  must  file  certified  copy  of  charter  with  tax  commissioners* 
p.  1253.  Savings  banks  shall  pay  an  annual  franchise  tax  of  one-fourth 
of  one  per  cent  on  total  deposits,  and  be  taxed  on  their  real  property,  p» 
1236. 

§  17.  MASSACHUSETTS. -Constitutional  Provisions.— This  state 
is  still  subject  to  the  constitution  of  1780  and  the  amendments  thereto. 
«•  No  man  or  corporation  or  association  of  men  have  any  other  title  to  ob- 
tain advantages,  or  particular  and  exclusive  privileges,  distinct  from 
those  of  the  commun'ty,  than  what  arises  from  the  consideration  of 
services  rendered  to  the  public,"  Part  I.  Art.  VL 

Miscellaneous  Corporations! — The  capital  of  manufacturing  or  mining 
corporations  is  to  be  not  less  than  $5,000  nor  more  than  $1,000,000. 
May  be  formed  by  three  or  more  to  carry  on  any  lawful  business,  except 
buying  and  selling  real  estate,  or  distilling  or  manufacturing  liquor. 
Capital  may  vary  from  $1,000  to  $1,000,000,  Pub.  Stat.  1882,  p.  573, 
Sworn  certificate  of  officers  setting  forth  the  articles  is  to  be  exam- 
ined and  approved  by  a  commissioner  of  corporations  and  filed  with 
secretary  of  state,  p.  575.    Proxies  must  be  not  older  than  six  months. 


8  17 


MASflACIIUHK'ITH. 


« 


if  the  maker  resiiles  in  the  Uniteil  States,  p.  576  and  ch.  188,  Acts 
1888,  Shares  not  to  be  issued  for  less  than  i)ar,  Id. p.  567.'  Fran- 
chise may  be  attached  and  sold  on  evecution,  hi.  pp.  568,  569. 
Special  stock  redeemable  in  casli  may  be  issued  at  a  special  meeting 
but  shall  not  exceed  two-fifths  of  capital  stock,  p.  578.  Shall  not 
commence  business  until  whole  capital  stock  is  paid  in  and  certi- 
ficate to  that  effect  filed.  Subscriber  cannot  pay  for  his  stock  by  his 
note  or  obligation.  Stock  may  be  issued  for  property  only  when  |)resi- 
dent,  treasurer  and  majority  ot  directors  sign  and  swear  to  statement 
that  the  property  is  at  fair  valuation  worth  the  property  which  is 
described  in  full  and  the  commissioner  of  corporations  certifies  that  he 
lielieves  the  valuation  is  fair  and  reasonable.*  Corporations  may  carry 
on  business  out  of  the  state."  May  change  business  by  unanimous  vote  of 
stockhoklers  and  by  filing  an  additional  certificate,  p.  579.  Annual  re- 
ports must  be  made,  580.  President  and  directors  are  liable  personally 
■  for  repayment  of  any  loan  to  a  stockholder;  for  corporate  debts  in  ex- 
cess of  the  capital  stock  ;  for  signing  a  false  statement  relative  to 
issuing  stock  for  property.  Subscribers  not  having  paid  their  subscrip- 
tions are  liable  individually  for  corporate  debts  contracted  before  sub- 
scription is  paid.  All  stockholders  are  liable  for  debts  to  operatives 
for  service  demanding  pay  within  six  months  after  the  labor,  p.  581. 
Stockholder's  liability  not  to  exceed  par  value  of  the  stock  held  by 
him.  Stockholder  may  defend  suit  against  corporation,  when  he  is 
liable  on  judgment  sought.  But  may  be  required  to  give  security  for 
costs,  p  582.  May  issue  special  stock  to  be  held  by  employes,  of 
$10  par  value  to  be  paid  for  in  monthly  payments  of  one  dollar.  Not  to 
exceed  three-fifths  of  whole  capital  stock.  Not  transferable  except  to 
the  corporation  or  an  employe,  ch.  209,  L.  1886.  Mechanical,  manu- 
facturing or  gas  corporation  may  hold  real  estate  necessary  for  its  pur- 
poses not  to  exceed  three-fourths  of  capital  stock,  Pub.  Stat.  p.  577. 

RailrondH. — Twenty-five  may  incorporate,  of  whom  majority  must  be 
residents,  p.  606.  Directors  must  be  stockholders  and  a  majority  must 
be  inhabitants  of  the  state,  p.  607.*  Certificate  of  incorporation  must 
be  approved  by  railroad  commissioners  and  certain  prerequisites  be 
■complied  with,  p.  608.  Towns  or  cities  of  less  than  30,000  popula- 
tion may  subscribe  to  extent  of  two  per  cent  of  their  valuated  property, 
and  if  valuation  is  less  than  13,000,000,  may  subscribe  also  to  extent  of 
one-tenth  of  valuation  upon  two-thirds  vote  of  legal  voters,  p.  610.  Con- 
struction of  road  to  be  commenced  within  two  years  and   completed 

'  Coolc  on  Stock  and  Stockholders  and  General  Corporation    Law,  chapter  iii. 
V«/. ,  chapter  iii.  '/</.,  chapter  xiii.  and  xli.  •/</.,  chapter  xxxvii. 


iM»'-'rt>'^>>'.-''«i"'Tffl#r-*  '^ 


lf\ 


u 

and  th.  i88,  Acts 
J.p,  567.'      Fran- 

il.    PP-    568.   569- 
a  special  meeting 

578.  Shall  not 
laid  in  and  certi- 
•  his  stock  by  his 
,-  only  when  presi- 
ivear  to  statement 
jroperty  which  is 
s  certifies  that  he 
>rations  may  carry 
unanimous  vote  of 

579.  Annual  re- 
e  liable  personally 
arate  debts  in  ex- 
tement  relative  to 
laid  their  subscrip- 
acted  before  sub- 
cbts  to  operatives 
the  labor,  p.  581. 
the  stock  held  by 
ation,  when  he  is 

give  security  for 
I  by  employes,  of 
one  dollar.  Not  to 
nsferable  except  to 
Mechanical,  manu- 
essary  for  its  pur- 
d).  Stat.  p.  577, 
1  majority  must  be 
id  a  majority  must 
ncorporation  must 
n  prerequisites  be 
an  30,000  popula- 

valuated  property, 
)e  also  to  extent  of 
)ters,  p.  610.  Con- 
,rs  and   completed 


n    Law,  chapter  iii. 
*/d.,  chapter  xxxvii. 


46 


MA(4HACHUHKTTH. 


8    17 


within  four.  Id.  p.  609.'  I'resident  must  call  meeting  on  written  re- 
quest of  thirty  stockholders  ;  or  if  whole  number  be  less  than  thirty,  of 
majority. 

No  persons  except  municipal  cor|)orations  ca:i  vote  over  oue-tenth 
of  capital  stock.     No   proxies  good   unless   made  within   six   months. 

'I'ransfcr  books  may  be  kept  at  place  authorized  by  directors.  On 
forfeiture  of  stock,  the  stockholder  is  liable  for  the  deficiency,  p.  611. 
Railroad  bonds  may  be  sold  at  less  than  par,  Id.  p.  613.  'rruslces  ii\ 
jwssession  may  contract  with  the  corporation  to  ojierate  road.  Id.  p. 
6i.^;  and  must  call  annual  meetings  of  bondhoidL-rs,  Id.  p.  614.  Kxcept 
by  .«>pecial  authority,  railroads  shall  not  duectly  or  inilircctiy  subscribe 
for,  take  or  hold  shares  of  stock  in,  or  the  bonds  of,  or  guarantee  the 
bonds  or  dividciuls  of  any  other  corporation. 

In  no  case  shall  its  bonds,  and  bonds  guaranteed  by  it,  exceed  its 
capital  stock  actually  paid  in  cash.  Hut  railroads  may  take  stock  in 
telegraph  company;  guarantee -teamship  company's  bonds;  take  stock 
in  elevators,  or  guarantee  con  icting  railroad  bonds  or  aid  in  construc- 
tion of  branches,  p.  615.  No  city  or  town  may  aid  railrcjad  so  as  to  in- 
crease its  inilebtedness  beyond  three  per  cent  of  valuation.  Id.  p.  247. 
Street  railway  corporations  may  issue  mortgage  bonds  upon  the 
written  assent  of  a  majority  in  interest  of  the  stockholders  and  the  ap- 
proval of  the  railroad  commissioners,  L,  1889,  ch.  316. 

Banks.—  leii  "r  more  may  incorporate  under  the  general  law.  Ca|)ital 
stock  may  vary  from  $100,000  to  $1,000,000.  No  person  shall  own  or 
hold  over  one-half  of  the  capital  stock,  p.  673.  A  stockholder  has  one 
vote  for  one  share,  and  a  vote  for  every  additional  share,  but  not  more 
than  ten  votes  in  all.  Proxies  good  for  three  months,  p.  674.  Directors 
must  own  five  shares,  be  citizens  and  residents,  and  majority  must  be  resi- 
dents of  county  or  reside  within  ten  miles  of  the  bank.  May  be  removed 
by  stockholders,  p.  675.  Debts  due  the  bank  not  to  exceed  twice  its 
capital  stock  paid  in. 

No  bank  to  loan  on  pledge  of  own  stock  more  than  one-half  paid  in 
capital,  Id.  p.  676.  Not  to  hold  own  stock  except  as  security  for  debts, 
Id.  Directors  liable  for  excess  of  debts.  Id.  May  hold  necessary  real 
estate  not  to  exceed  twelve  per  cent  of  capital,  exclusive  of  realty  held 
to  secure  debts.  Id.  p.  677.  Stockholders  liable  to  extent  of  stock  for 
mismanagement  of  officers,  683.'  Ch.  116  of  Pub.  Stat,  contains 
general  provisions  regarding  savings  banks  which  are  operated  for  the 
profit  of  the  depositors.     Savings  banks  may  invest  in  the  first  mort- 


>See  Cook  on  Stock  and  Stockholders  and  General  Corporation   Law,  chapter 

xxxviii.,  §  638. 
*/</.,  chapter  xii. 


T 


§  17 


MASSACHUSETTS. 


46 


gage  bonds  of  certain  New  England  railroad   corporations,  L.   1889, 
ch,  305. 

General  Provisions.— No  officer  of  the  corporation  shall  cast  as  proxy 
more  than  twenty  votes,  unless  owned  by  one  person.  Nosala. led  of- 
ficers shall  vote  as  proxy,  p.  566.  No  telegraph  or  gas  company  shall 
declare  a  stock  dividend,  p.  567.  Transfer  registeries  to  be  made  within 
the  state  and  register  to  reside  in  state,  p.  567.  Certificates  issued  to 
pledgee  must  state  that  fact,  p.  508.  Shares  of  stock  may  be  attached 
and  sold  on  execution,  pp.  929,  1006.'  Sales  of  stock  which  the 
vendor  doe  not  then  own  or  control  are  void,  p.  430.*  Stock  cannot 
be  issued  below  par,  p.  567.*  Unregistered  written  transfer  of  stock  is 
effective,  except  as  against  the  corporation,  ch.  229,  L.  1884. •♦  Foreign 
corporations,  except  insurance  companies,  shall  file  copy  of  charter  and 
statement  of  condition  with  the  commissioner  of  corporations,  and  shall 
appoint  said  commissioner  their  attorney  to  accept  service  of  process. 
Failure  incurs  penally  of  $500,  ch,  330,  acts  1884.'  As  to  insurance 
companies  see  Tub.  Stat.  p.  723.  Foreign  manufacturing  companies 
having  complied  with  above  provision  may  hold  real  estate  necessary  to 
conduct  their  business,  ch.  321,  Acts  1888.  The  officials  of  every  com- 
pany chartered  in  the  state  are  required  to  file  at  the  state  house,  on  the 
request  of  any  stockholder,  between  thirty  and  sixty  days  before  its 
annual'meeting,  complete  lists  of  the  shareholders,  with  their  residences 
and  the  number  cf  shares  belongifigto  each.  Th^se  statements  are  to 
be  made  in  a  form  ajiproved  by  the  commissioner  of  corporations  and 
are  to  be  sworn  to.  The  penalty  for  neglect  to  file  the  required  lists  is 
a  fine  of  $1,000  against  the  corporation  and  the  same  sum  on  the 
delinquent  official,  L.  1889.  A  commissioner  is  authorized  to  examine 
and  regulate  foreign  mortage  corporations,  L.  1889,  ch.  427. 

Taxation.'— A  fee  of  one-twentieth  of  one  percent  of  the  capital  stock 
IS  charged  for  filing  the  certificate  of  incorporation  for  manufacturing, 
etc.,  corporations  and  others,  but  such  fee  is  not  to  exceed  $200,  p. 
585.  Shares  of  stock  in  turnpike,  bridge  or  moneyed  corporation  are 
taxed.  No  state  or  municipal  tax  on  shares  of  stock  in  corporation 
paying  tax  on  franchise,  except  tax  for  school  districts  and  parishes, 
p.  96,  and  c.  228,  Acts  1887.  In  assessing  shares  of  stock  in 
manufacturing  corporations  deduction  is  made  for  value  of 
machinery  and  real  estate  owned  by  corporation,  p,  100.  Stock- 
holder    evading   tax    forfeits   one-half'    par   value    thereof,    p,    102. 

'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxvii. 
'/</.,  chapter  xx.,  §§  341-347.  »/</.,  chapter  iii., 

♦/;/.,  chapter  xxvii.  g§  486-490.  •/</.,  chapter  xli. 

*Jd.    chapter  xxxi  /. 


46 

jorations,  L.   1889, 

shall  cast  as  proxy 
n.     No  salaried  of- 
gas  company  shall 
s  to  be  made  within 
rtificates  issued   to 
Ic  may  be  attached 
if  stock  which    the 
J0.2     Stock   cannot 
transfer  of  stock  is 
L.  1884.*      Foreign 
copy  of  charter  and 
porations,  and  shall 
service   of   process. 
,.»     As  to  insurance 
acturing  companies 
I  estate  necessary  to 
ficials  of  every  com- 
;  state  house,  on  ihe 
ity   days  before   its 
with  their  residences 
:  statements   are   to 
of  corporations  and 
:  the  required  lists  is 

same  sum  on  the 
horized   to  examine 

ch.  427. 
tof  the  capital  stock 

for  manufacturing, 
to  exceed  $200,  p. 
yed  corporation  are 
cock  in  corporation 
stricts  and   parishes, 

shares  of  stock  in 
ade  for  value  of 
an,  p.  100.  Stock- 
le    thereof,    p.    102. 

on  Law,  chapter  xxvii. 
er  iii., 
er  xli. 


47 


MICHIGAN, 


§  18 


Shares  may  be  sold  for  non-payment  of  taxes,  p.  116.  Bank  shares  are 
taxed  at  location  of  bank,  and  bank  pays  the  lax,  p.  131.  But  such  tax 
is  distributed  elsewhere  where  stockholders  reside,  p.  132.  All  cor- 
porations, except  banks,  mining  corporations  doing  business  out  of  the 
slate  and  railroad  companies  operating  out  o*"  the  state,  pay  a  franchise 
tax  on  the  actual  market  value  of  all  the  share  s  of  stock,  less  the  value 
of  real  estate  and  machinery  in  the  state,  and  in  case  of  railroads  and 
telegraph  less  the  value  of  lines  beyond  the  siate.  Rate  of  tax  same  as 
proportion  of  all  taxes  raised  by  municipalities  to  all  the  property  as 
valued  by  the  municipalities,  p.  139.  Mining  companies  doing  business 
out  of  the  state  pay  semi-annual  tax  of  one-furtieth  of  one  per  cent  of 
•capital  stock  paid  in,  and  four  per  cent  of  net  profits,  p.  140,  amended  ch. 
106,  Acts  1882,  and  ch.  74,  Acts  of  1883.  Corporations  to  build  rail, 
road  in  foreign  countiy  subject  to  like  tax.  Id.  p.  141.  No  tax  lai-J  on 
shares  of  stock  in  corporations  paying  the  above  tax,  but  the  siMe 
distributes  its  tax  among  the  municipalities  where  the  stockholders 
reside,  p.  143.  Foreign  corporations  pay  fees  of  $15  to  commissioners 
for  filing  charter  and  statement,  ch.  300,  Acts  1884.  Tax  on  bank  stock 
is  lien  thereon.     Bank  may  pay  under  protest,  ch.  142,  Acts  1S87. 

§  18.  MICHIGAN.  Constitutional  Provisions.— Incorporations  by 
special  act  are  prohibited,  except  for  municipal  purposes,  Art.  XV., 
§  I.  Legislature  may  by  two-thirds  vote  create  a  bank  with  branches, 
Const.  XV.,  §  I.  General  banking  law  must  be  submitted  to  popular 
vote.  Id.  §  2.  "The  stockholders  of  all  corporations  and  joint  stock 
association  shall  be  individually  liable  for  all  labor  performed  for  such 
corporation,"  Id.  §  7.1  Term  of  existence  limited  to  thirty  years, 
except  for  railroads,  plank-roads  and  canals,  Id.  §  10.  "No  corpora- 
tion shall  hold  any  real  estate  hereaftei  acquired,  for  a  longer  period 
than  ten  years,  except  such  real  estate  as  shall  be  actualiy  occupied  by 
such  corporation  in  the  exercise  of  its  franchises,"  Id.  §  i^.'  "  No 
railroad  corporation  shall  consolidate  its  stock,  property  or  franchises, 
with  any  other  railroad  corporation  owing  a  parallel  or  competing  line,'» 
and  on  consolidation,  except  on  sixty  days  puUlic  iiotice  to  stockholders. 
Amendment  of  1870,  Art.  XlXa.,  §  2. 

Miscellaneous  Corporations. — Three  or  more  may  incorporate  to  carry 
on  "any  kindofmanuiacturing  or  mercantile  business,  or  any  union  of  the 
two,"  Acts  1885,  p.  343.8  Stock  to  be  $£,000  or  over,  in  shares  of  $25,  and 
not  to  exceed  $5,000,000,  Id.  Ten  per  cent  to  be  paid  in  upon  incorpora- 
tion. Directors  must  be  stockholders,*  and  may  Ije  from  three  to  nine  in 
'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xii. 
'Id.,   chapter  xli.  '/</.,  chapter  xiii.  */</.,  chapter  xxxvii. 


§  18 


MICHIGAN. 


48 


number,  Id.  p,  345.  Secretary  and  treasurer  must  be  residents  of  the 
state.  One  person  may  fill  both  offices,  Id.  Directors  must  make  annual 
reports,  Id.  p.  346.  Books  of  the  corporation  t.  be  open  always  at  the 
hief  place  of  business  in  state  to  inspection  of  stockholders,  Id.  p.  348.^ 
May  hold  land  necessary  for  purposes  and  in  payment  of  or  '.o  secure 
debts.  It  may  also  purchase  and  hold  any  grant  of  land  made  by  the 
general  government  to  aid  in  any  work  of  internal  improvement  in  the 
state.  Id.  p.  348.  May  change  or  extend  business  by  filing  new 
certificate,  on  consent  of  two-thirds  of  stock.  Corporation  has  a  lien 
en  the  stock  for  debts  due  to  it."  Meetings  of  the  stockholders  or 
directors  may  be  held  out  of  state,  but  one  office  and  agent  shall  be 
kept  within  the  state,  Id.  p.  349. 

Three  or  more  persons  may  fo-m  a  partnership  association  to  con- 
duct any  lawful  business  anywhere  but  having  its  principal  office  in 
Michigan,  by  contributing  to  capital  which  shall  alone  be  lialile  for 
~debts,  and  signing  arkuO' Hedging  and  recording  a  prescribed  statement 
The  word  "  limited  "  shall  be  added  as  part  of  name.  Contributions  to 
capital  may  be  in  property.  Gen.  Stat.  §2365.  Members  always  liable 
for  labor  done  but  otherwise  only  for  unpaid  subscriptions,  g  2366.* 
Omission  of  word  "limited"  makes  all  individually  liable,  §  2367. 
Interests  in  association  are  personalty  and  transferable  but  transferee 
must  be  elected  by  majority  in  number  and  value.  If  not  elected  must 
be  paid  agreed  or  appraised  value  of  interest,  §  2368.  Managers  shall 
be  three  to  five  who  must  be  parties,  all  or  some,  to  every  obligation 
assumed.  By-laws  originally  adopted  can  only  be  amended  by  written 
consent  of  three-fourths  of  thi  members  in  number  and  value,  §  2369. 
Cannot  loan  cred't  to  members,  nor  to  any  other  person  without  con- 
sent of  majority  and  then  only  to  benefit  the  association,  §  2371. 

Railronds.— Seven  or  more  may  incorporate,  §  3313.  Purchasers  at 
foreclosure  sale  may  incorporate  and  have  powers  of  old  corporation, 
§  3314.  Directors  to  be  stockholders.*  Stockholders  in  arrears  not 
to  vote.  Only  stock  held  ten  days  can  be  voted,  §  3315.  *'  The  stock- 
holders representing  a  majority  in  value  of  the  stock  may  remove  from 
office  any  of  the  directors,  or  other  officers  of  the  company,  and  elect 
others  in  their  stead,  and  the  president,  and  directors,  and  officers  and 
agents  of  the  company,  in  the  exercise  of  their  rvispective  powers  and 
duties,  shall  at  all  times  be  governed  by  and  be  subject  to  such  rules 
regulations  and  directions,  as  the  stock!'iolders  holding  a  majority  in 
value  of  the  stock  may  adopt  at  such  meeting,"  §  3317.  Articles  may 
be  amended  by  two-thirds  stock  vote,  §  3316.     One-fourth  in  value  of 

•  Cook  o.n  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxx. 
Vrf.,  chapter  xxxi.    ^,_        ...i^^ '/</.,  chapter  xii.  •/</.,  chapter  xxxvii. 


48 

residents  of  the 
uist  make  annual 
len  always  at  the 
Iders,  Id.  p.  348.' 
t  of  or  '0  secure 
and  made  by  the 
irovement  in  the 
ss  by  filing  new 
ation  has  a  lien 
stockholders  or 
i   agent  shall   be 

sociation  to  con- 
)rincipal  office   in 
)ne   be  liable   for 
;scribed  statement 
Contributions  to 
)ers  always  liable 
riplions,    §  2366.^ 
y   liable,    §    2367. 
)le   but  transferee 
f  not  elected  must 
Managers   shall 
every  obligation 
-nended  by  written 
id  value,  §    2369. 
erso:i  without  cor- 
on,  §  2371. 
13.     Purchasers  at 
f  old   corporation, 
:rs  in    arrears  not 
15,     "  The  stock- 
may  remove  from 
)mpany,  and  elect 
s,  and  officer'-,  and 
active  powers  and 
ect  to  such  rules 
ling  a  majority  in 
317.    Articles  may 
fourth  in  value  of 

n  Law,  chapter  XXX. 
*M ,  chapter  xxxvii. 


49 


MICHIGAN. 


8  18 


stock  may  call  meeting,  §  3317.  "Any  certificate  of  stock  issued  be- 
fore pay.Tient  in  full,  shall  show  on  its  face,  or  by  indorsement,  the 
amount  paid  thereon,  and  no  share  shall  be  transferred  on  the  books 
of  the  company  until  the  same  shall  be  paid  in  full,  without  the  consent  of 
the  board  of  directors,"  §  3320.  May  subscribe  to  stock  of  any  other 
railroad  company,  except  coterminous  and  competing  lines,  gj^  3342, 
3413.  Railroads  not  competing  may  consolidate,  upon  assent  of  ma- 
jority in  interest  of  each  corporation,  §  3343.  May  execute  mortgages 
with  power  of  sale,  §  3351.  May  issue  bonds  convertible  into  stock; 
may  sell  their  obligations  at  such  prices  as  they  deem  proper;  may  in- 
crease stock,  §  3352,  Stockholders  are  individiilly  liable  forlaborper- 
formed,  §  3385.*  Purchasers  at  foreclosure  sale  may  incorporate, 
§3406.  Preferred  stock  maybe  issued  but  no  dividend  greater  than 
eight  percent  shall  be  preferred  without  a  unanimous  vote  of  stockhold- 
ers, and  such  stock  shall  not  be  sold  for  less  than  par,  §  3407.  Issue  of 
fictitiously  paid  up  stock  is  prohibited.'  It  is  a  misdemeanor  for  officers 
to  issue  such,  §  0409.  May  subscribe  for  stock  or  guarantee  bonds  of 
other  railroads,  §  3413.  May  hold  land  to  amount  authorized  by  law; 
may  take  Michigan  land  for  subscription  to  stock  or  receive  donations 
of  land,  g  4866.^  A  railroad  commissioner  has  power  to  investigate,  and 
also  to  regulate  various  abuses,  but  not  to  regulate  rates,  ch.  90. 
A  domestic  railroad  corporation  may  sell  its  road  to  another  domestic 
railroad  corporation,  provided  a  majority  of  the  stock  of  each  company  is 
voted  in  favor  thereof,  and  provided  the  roads  of  the  companies  are  not 
competing  lines  and  have  different  terminal  points,  L.  1889,  Act  of  Febru- 
ary 27. 

jilanks. — Five  or  more  may  organize  with  minimum  capital,  varying 
with  the  population,  from  $25,000  to  $100,000.  Shall  not  loan  or  discount 
on  security  of  its  own  stock.*  Articles  are  to  be  acknowledged  and  filed. 
One-half  of  the  capital  is  to  be  paid  in  before  commencing  business  and  the 
remainder  in  ten  per  cent  monthly  installments.  A  commissioner  shall 
examine  the  condition  of  the  bank  and  issue  certificate  authorizing  it  to 
commence  business,  which  certificate  shall  be  published  for  six  weeks.  No 
transfer  of  stock  binds  the  bank  as  long  as  transferer  is  indebted  to  it." 
The  bank  to  have  not  less  than  five  directors  who  shall  each  own  ten  shares 
and  take  oath.^  In  elections  each  share  nasone  vote  and  no  officer  or  clerk 
can  act  as  proxy.  No  stockholder  may  vote  who  is  indebted  to  the  bank 
on  a  past  due  obligation.  A  list  of  stockholders  is  to  be  annually  filed. 
Quarterly  reports  are  to  be  made  and  additional  reports  may  be  called  for 

'Cook    en  Slock  and   Stockholders  and  General  Corporation   Law,  chapter  xiL 
Vrf.,  chapter  iii.  '/d.  chapter  xli.  Vrf.,  chapter  xix. 

*/</.,  chapter  xxxi.  */</.,  chapter  xxxvii. 


I!'  'i 


§  18 


MICHIGAN, 


60 


by  commissioner.  A  rommercial  bank  shall  not  loan  on  real  estate 
security  to  exceed  half  its  capital  stock'  and  shall  loan  only  upon  resolu- 
tion iiy  a  two-thirds  vote  of  directors  stating  to  what  extent  such  loans  shall 
be  made.  Savings  banks  shall  hold  a  reserve  of  fifteen  per  cent  of  total 
deposits.  Two-thirds  of  remainder  to  be  invested  in  United  States,  state 
or  municipal  bonds  or  on  mortgages  on  fifty  per  cent  valuation.  A  state 
banking  department  is  organized  as  a  distinct  bureau.  All  stockholders  in 
banks  are  individually  liable  to  the  amount  of  their  stock  in  addition  to 
said  stock.'  Total  loans  of  the  bank  to  one  concern  are  not  to  exceed  one- 
tenth  of  capital  and  surplus'  except  loans  upon  real  estate  and  authorized 
collaterals  or  by  two-thirds  vote  of  directors,  in  which  latter  case  it  may 
be  one  fifth  of  capital.  Consolidations  authorized  on  approval  of  com- 
missioner. Real  estate  of  banks  is  taxed  where  situated  and  residue  of 
capital  and  surplus  as  personal  property.  May  hold  real  estate  to  sat- 
isfy and  secure  debts  previously  contracted  and  for  convenient  transac- 
tion of  business,  including  apartments  to  rent  as  source  of  income,  but 
not  to  exceed  fifty  percent,  of  paid  in  capital.  This  act  approved  June  21, 
1887,  and  ordered  submitted  at  the  next  general  election,  was  adopted  by 
the  vote  of  the  people,  No.  205,  Acts  1887,  pp.  225-242. 

General  Proylsloiiu. — May  amend  articles  of  association  by  filing  an 
additional  certificate,  Gen.  Stat.  §  4866,  Franchises  may  be  sold  on 
execution,  §§  4868-4874,  The  corporate  clerk  or  directors  must  report 
to  township  supervisors,  the  names  of  stockholders  residing  therein  and 
shares  owned  by  them,  §  4880.  Transfers  to  avoid  taxation  forfeit  one- 
half  of  par  value,  §  4882.  Officers  of  bank,  railroad,  canal  or  turnpike 
company  must  report  to  stale  treasurer  capital  stock  paid  in,  §  4883. 
On  foreclosure  sale  the  purchasers  may  incorporate  and  have  a  11 
the  rights  of  the  old  corporation,  §  4885,  When  stockholders  are  in- 
dividually liable,  and  after  judgment  by  the  corporate  creditor  and  exe- 
cution returned  unsatisfied  the  court  will  require  the  corporate  secretary 
to  file  in  the  case  a  complete  list  of  stockholders  who  are  liable.  Such 
stockholders  are  then  brought  in  by  service.  They  must  answer  sep- 
arately; judgment  against  the  corporation  is  prima  facie  evidence  of 
amount  due,  but  not  of  liability  of  defendant  stockholters.  Separate 
judgments  are  entered  and  apportionments  then  made  by  the  court.  Reap- 
portionment, if  part  are  insolvent,  §§  4886-4889.  Domestic  corporations 
having  principal  office  out  of  the  state  must  keep  stock  and  transfer  books 
at  branch  office  within  state,  §  4900.  Shares  of  stock  may  be  taken  under 
levy  of  execution,  §§  7697-7701.  Circuit  courts  have  power  to  suspend 
directors  for  abuse  of  trust  and  to  remove  them  for  gross  misconduct, 

'  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter    xli. 
V</.,   chapter  xii.  V</.,  chapter  xli. 


T 


M* 


50 


w 


MINNESOTA. 


8   19 


in  on  real  estate 
only  upon  resolu- 
:nt  such  ioans  shall 
1  per  cent  of  total 
nited  States,  state 
valuation.  A  state 
Ail  stockholders  in 
ock  in  addition  to 
not  to  exceed  one- 
:ate  and  authorized 
latter  case  it  may 
1  approval  of  com- 
:ed  and  residue  of 
I  real  estate  to  sat- 
lonvenient  transac- 
ce  of  income,  but 
t  approved  June  21, 
ion,  was  adopted  by 

!42. 

ciation  by  filing  an 
;s  may  be  sold  on 
rectors  must  report 
residing  therein  and 
axation  forfeit  one- 
1,  canal  or  turnpike 
ck  paid  in,  §4883. 
rate  and  have  a  11 
ockholders  are  in- 
te  creditor  and  exe- 
corporate  secretary 

0  are  liable.  Such 
'  must  answer  sep- 

1  facie  evidence  of 
kholcers.  Separate 
by  the  court.  Reap- 
amestic  corporations 
k  and  transfer  books 
c  may  be  taken  under 
ive  power  to  suspend 
jr  gross  misconduct, 
tion  Law,  chapter   xll. 


§  8150.'     Creditor,  officer,  attorney  genera'  or  stockholder  may  insti- 
tute the  suit,  §  8152.*     By  the  Act  of  1885,  p.    116,    the  principle  of 
cumulative  voting  is  applied   to  all   corporations,  except    municipal.' 
Cumulative    voting    provided   for  by  Act    No.  123,  Pub.  Acts  1887.* 
Taxation.' — "All  shares  in  corporations  organized  under  the  laws  of 
this  state,  when  the   property  of  such  corporation  is  not  exempt,  or  is 
not  taxable  to  itself ;  all  shares  in  banks  organized  in  this  state  under 
any  law  of  the  United  States,  but  in  estimating  the  value  of  such  shares 
deduction  shall  be  made  of  the  value  of  all  real  estate  taxed  to  the 
bank;  all  shares  in  foreign  corporations  (except  national  banks)  owned 
by  inhabitants  of  this  state  "  shall  be  subject  to  taxation.  Laws  of  1885, 
p.  175,  and  see  Acts  188/,  p.  407.    Shares  in  corporations,  the  property 
of  which  is  taxable  to  itself,  shall  not  be  assessed  to  the  shareholder. 
Id.  p.  175.    "  The  property  of  corporations  paying  a  specific  tax  shall  be 
exempt,  as  to  the  property  covered  by  such  taxation,  except  when  other- 
wise provided  bylaw,"  Id.  p.  176.      All  shares  in  banks   shall   be  as- 
sessed to  their  owners  in  the  town  where  the  bank  is  located,   unless 
they  reside  elsewhere  in  that  county,  Id.  p.  177.     Railroads   art  taxed 
two  per  cent  of   gross  receipts  up  to  $4,000  a  mile,  for  miles  actually  in 
operation,  and  three  per  cent  en  all  excess.    N  j  tax  on  land  used  frr  rail- 
road purposes,  but  tax  on  land  the  railroad  might  convey  away,  §§  3360, 
1218.     The  tax  is  apportioned  if  the  road  is  partly   out   of   the  state, 
Id.    Real  estate  owned  by  banks  is  taxed,  §  3186.     Mining  companies 
pay  a  tax  on  each  ton  of  ore,  §§  4019,   3997.     Manufacturing  cor- 
porations pay  a  tax  on  realty  and  personalty,  but  not  on  capital  stock 
4020.      Mining,     smelting,  etc.,  companies  pay  tax    of    seventy-five 
cents  per  ton  on  copper,  one  cent  on  iron  and  one-half  cent  on  coal,  in 
lieu  of  all  state   taxes,  except  specific  tax  on    capital   stock,    Pub.  Acts 
1887,  No.  108. 

§  19.  MINNESOTA.-Constitntional  Provisions.— Before  a  railroad  cor- 
poration shall  be  allowed  to  pay  a  percentage  of  its  gross  earnings  to  the 
state  in  lieu  of  all  other  taxation,  the  proposition  must  be  submitted  to  the 
people,  Art.  IV.,  §  32  a.  Corporate  powers  not  to  be  granted  by  special 
legislation.  Art.  IV.,  §  33,  L.  1883.  p.  2,  and  suppm't  1888,  p.  10. 
Stocks  are  to  be  taxed,  Art.  IX.,  §  3.  Property  of  banks  is  to  be  sub- 
ject to  a  tax  equal  to  that  on  individuals  Id.  §  4.  Credit  of  the 
state  shall  not  be  loaned  or  given  to  any  corporation,  Id.  §  10.  Legis- 
lature may  by  two-thirds  vote  pass  general  banking  law  under  certain  re- 

'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxix. 
'  Id.,  chapter  xlv.  •  Id.,  chapter  xxxvii.  *  Id.,  chapter  xxxvii. 

*  Id.,  chapter  xxxiv. 


il  ti  t 


§  19 


MINNESOTA. 


52 


strictions,  Art.  IX.,  ^  13.  Stockholders  in  banks  are  liable  to  double  the 
amount  of  their  stock.'  Are  liable  for  a  year  after  transfers  by  them 
Art.  IX.  §  14.  Municipalities  not  to  aid  railroads  to  an  amount  over, 
five  per  cent  of  value  of  taxable  property,  Id.  ^  XV.,  L.  1881,  p.  17,  and 
Supp.  1888,  p.  21.'^  Corporations  shall  not  be  formed  by  special  acts^ 
Art  X.  §  I.  Stockholders  in  all  corixirations,  except  those  for  manu- 
facturing and  mechanical  purposes,  are  individually  liable  "to  the  amount 
of  stock  held,"  Id.  ^  III.s 

MiscpllaiieoiiM  Corporations.— Three  or  more  may  incorporate  for  any 
•'lawful  business,'.'  Gen.  Stat.  1888,  394.  Articles  of  association  shall 
state  the  highest  limit  of  indebtedness  to  be  incurred,  p.  395,  g  1 10.^  Pub- 
lication of  the  articles  must  be  made,  ld.»  Articles  may  be  amended,  Id. 
Statement  of  capital  stock  subscribed,  of  amount  of  capital  paid  in, 
and  of  indebtedness  to  be  posted  at  principal  place  of  business.  Id. 
Transferers  of  stock  liai»ie  on  subscription  for  debts  already  incurred , 
■"Id.  Stockholders  liable  for  unpaid  stock  and  liable  as  partners  if  in- 
corporation was  irregular,  Id.«  Liability  of  stockholder  is  enforced  by 
execution  issued  first  against  the  corporation,  Id.^  Capital  stock  shall 
not  be  less  than  $10,000,  §  112  and  L.  1883,  ch.  4,  §  1,  and  suppm't 
1888,  p.  335.  Corporation  has  a  lien  on  stock  and  may  enforce  it  by 
proceedings,  the  same  as  in  forfeiture  of  stock,  §  ii4.»  Books  and 
records  are  to  be  open  to  inspection  of  stockholders.  Reports  to  be 
given  when  called  for,  §  115.  Principal  office  may  be  out  of  the  state 
but  must  have  an  office  in  the  state,  §  116.  Corporation  may  exist  for 

thirty  years,  §  117.  ,   •     ■ 

Manufacturing  corporations  shall  fix  amount  of  capital  stock  m  the 
articles,  but  it  may  be  increased,  Id.  p.  396,  §  120,  and  L.  1883,  ch.  105 
§  I  (see  Suppm't  1S88,  p.  335)-  Articles  may  be  amended,  §  122, 
amended  1879,  ch.  8,  §  i,  and  Suppm't  1888,  p.  336.  There  shall  be  at 
least  three  directors  who  shall  be  stockholders,  p.  397,  §  i24-'  Before 
commencmg  business  the  articles  must  be  published  and  a  certificate 
filed  with  secretary  of  state  and  cour'y  register,  §  i28.»»  At  all  meetings 
each  share  has  one  vote,  §129.  May  hold  real  estate  necessary  for 
purposes  and  to  secure  debts,  p.  398,  §  133."  Books  open  for  inspection" 
and  annual  statement  to  be  made,  §  134.  Stock  deemed  personalty,  and 
corporation  has  lien  upon  it  for  all  debts,  §  i35.»»  Stockholders  liable  for 
amount  received  of  improperly  withdrawn  capital,  p.  399,  §  139-     Cor- 

»  Cook  on  Stock  and  Stockholders  and  General  Corporation   Laws,  chapter  xii. 
Vrf.,  chapter  vi.  V</.,  chapter  xii.  *Id..  chapter  xli. ,  §  685. 

^Id.,  chapter  xiii..  §§  231-235.    "/</.,  chapter  xiii.  'Id.,  chapter  xii. 

•/</.. chapter  xxxi.  'Id.,  chapter  xxxvii.  ''Id.,  chapter  xiii. 

"/</.,  chapter  xli.  Id.,  chapter  xxx.  "/</.,  chapter  xxxi. 


1.  ;1.; 
If    li 


52 

iable  to  double  the 
transfers  by  them 
an  amount  over, 
,.  1881,  p.  17,  and 
ed  by  special  acts^ 
those  for  manu- 
)le  "to  the  amount 

corporate  for  any 
[  association  shall 

395.  §"o-^    P"*^- 
ly  be  amended,  Id. 

F   capital    paid    in, 

:e  of  business,  Id. 

already  incurred, 

as  partners  if  in- 

ler  is  enforced  by 

Capital  stock  shall 

§  1,  and  suppm't 

lay  enforce   it  by 

ii4,»    Books  and 

s.     Reports  to  be 

e  out  of  the  state 

ation  may  exist  for 

:apital  stock  in  the 
id  L.  1883,  ch.  105 
amended,  §  122, 
There  shall  be  at 
,7,  §  124.*  Before 
I  and  a  certificate 
8.1"  At  all  meetings 
state  necessary  for 
ipen  for  inspection" 
ned  personalty,  and 
ckholders  liable  for 
.  399,  §  139-     Cor- 

jn  Laws,  chapter  xii. 
d..  chapter  xli.,  §685. 
"d.,  chapter  xii. 
W. ,  chapter  xiii. 
Id. ,  chapter  xxxl. 


n 


es 


MINNESOTA. 


8   19 


poration  may  be  renewed  after  expiration  of  thirty  years  by  three- 
quarters  vote  at  regular  meeting,  those  desiring  renewal  to  purchase 
at  current  value  the  stock  of  those  opposed,  g  143.  If  the  corporation 
violates  the  general  incorporating  act  and  thereby  becomes  insolvent, 
-'the  directors  ordering  or  assenting  to  such  violation  shall  be  jointly 
and  severally  liable  in  an  action  founded  on  this  statute  for  all  debts 
contracted  after  such  violation."  (See  Patterson  v.  Minn.  Manufactur- 
ing Company,  42  N.  W.  Rep..  926,  §  23,  ch.  11,  Gen.  Stat,  of  1873.) 
Companies  for  mining  and  smelting  ores  and  companies  for  mining 
and  smelting  ores  and  manufacturing  metals  and  bricks  and  for  quarry- 
ing stone,  "  and  dealing  in  mineral  and  other  lands  "  may  be  formed  by 
three  or  more,  p.  400,  §  144,  and  i88i,  ch.  27,  §  i.  (SeeSupm't  1888, 
P-  337-)  Capital  must  be  $10,000  ;  no  maximum  limit,  §  147  and  1881, 
«fi-  27,  §  3-  (See  Suppm't  1888,  p.  338.)  May  have  office  and  hold  meet- 
ings out  of  state,  but  must  have  an  office  within  state,  p.  401,  §  150. 
Majority  of  stock  may  always  call  meeting,  §  149.  May  hold  stock  in 
any  other  corporation,  §  151  and  1881,  c.  27  §4.  (See  Supm't  1888, 
p.  338.) 

Railroads — Five  or  more  may  incorporate.  Id.,  p.  368.  Articles  are 
to  state  the  limit  of  mdebtedness  to  be  incurred.  Id.  Articles  are  to  be 
published.  Id.  May  be  amended.  Id.  p.  369.  May  exist  for  fifty  years 
and  may  be  renewed  upon  buying  out  dissenting  stockholders,  Id. 
Statement  of  capital  stock  subscribed,  of  amount  actually  paid  in,  and 
■of  indebtedness  of  company  must  be  kept  posted.  Id.  Transfer  books 
to  be  open  to  inspection  of  stockholders.  Id,  Stockholders  are  liable 
for  unpaid  subscriptions  and  for  irregular  incorporation,  p.  370,  Am'd 

1887,  ch.  12.  (See  Suppm't  1888,  p.  303.)  Consolidation  of  parallel  or 
competing  lines  is  forbidden,  p.  381.  (See  ch.  94,  L.  1881,  Suppm't  1888, 
PP>  324-326.)  Other  consolidations  authorized,  but  dissenting  stock- 
holders to  be  paid  at  least  the  par  value  of  their  stock,  Id.  May  aid, 
lease,  purchase  or  make  traffic  arrangements  with  connecting  lines,  p.  381. 
May  issue  preferred  stock,  special  stock  or  income  certificates,  and  give 
same  a  voting  right,  p.  383.  Proxies  must  not  be  over  a  year  old, 
p.  386.     Connecting  roads  may  consolidate,.  Laws  1881,  ch.  94,  Supm't 

1888,  p.  324.  Railroad  company  must  notify  public  commission  of 
completion  of  road  and  file  map  and  profile,  L.  1887,  ch.  11.  Capital 
stock  of  railroads  can  only  be  increased  by  special  authority  of  railroad 
and  warehouse  commission  obtained  upon  formal  application,  I..  1887, 
ch.  265,  Supm't  1888,  p.  327.  Unlawful  to  issue  stock  until  fully  paid, 
and  to  issue  stock  or  bonds  except  for  money,  labor  or  property  actually 
received.  Fictitious  stock,  etc.,  void,  and  to  issue  it  is  a  misdemeanor. 
Special  report  to  be  filed  annually  with  secretary  of  state  on  the  issue 


m 


t  rii 


§  20 


Misaiasippi. 


H 


r-i 


of  stock,  L.  1887,  ch.  i2,Suppm't  1888,  pp.  302,  303.  A  railroad  com- 
mission is  given  power  to  regulate  various  matters,  to  investigate  and 
to  report,  ch.  188,  L.  1885. 

General  Provisions Stockholders'  and  directors'  meetings  may  be 

held  out  of  the  state,  Id.  449.  Justice  of  peace  may  call  meeting-,  in 
certain  cases,  on  application  of  three  or  more  members,  j  The  tenure 
of  office,  method  of  voting,  etc.,  may  be  fixed  by  the  1. .  laws.  Id.  450. 
Stock  shall  not  be  issued  for  l^ss  than  it.s  par  value,  It.,  amended  1887, 
ch.  49.  (See  Suppi.i't  i8l8,  p.  412.)  Foreign  land  and  immigration  com- 
panies miy  hold  noc  more  than  100,000  acres  of  land,  all  to  be  sold 
within  twenty-one  years,  except  such  as  is  acquired  by  forfeiture  on 
contracts  or  by  foreclosure  of  mortgages,  which  shall  be  sold  within 
fifteen  years.  Must  have  resident  agent,  ch.  125,  L.  1881  (see 
Suppm't  1888,  p.  393).  Mo  corporation  other  than  railroad,  canal,  etc., 
shall  hold  more  than  5,000  acres  of  land,  1887  ch.  204,  Suppm't  1888, 
p.  770.  No  corporation  nijie  than  twenty  per  cent  of  whose  stock  is 
own'id  by  aliens  can  hold  land  in  this  state,  1788,  ch.  204,  Supm't 
1888,  p.  769. 

Taxation.— Corporations,  excepting  banks,  railroads  and  insurance, 
shall  make  a  return  of  capital  stock.  It  is  taxed  en  actual  value  of  all 
the  shares  of  stock,  less  indebtedness  and  value  of  corporate  realty  and 
personalty,  Laws  1885,  ch.  78,  see  Suppm't  1888,  p.  184.  The  real  and 
personal  property  of  coqwrations  is  taxed.  Id.  Shares  of  stock  in 
foreign  corporations  or  in  national  banks  situated  in  the  state  are  taxed. 
Gen.  Stat.  1878,  p.  211.  Shares  of  stock  in  all  corporations  are  taxed, 
unless  the  property  of  the  company  is  assessed  in  the  state,  Id.  p.  213. 
Capital  stock  shall  be  taxed  where  the  principal  place  of  business  is  or 
principal  business  is  transacted.  Id.  Bank  stock  is  taxed  on  value  ob- 
tained by  deducting  real  estate  which  is  otherwise  taxed,  from  capital 
,".nd  surplu.;thetax  is  paid  by  thebank,  and  a  lien  therefor  exists  on 
the  stock.  Id.  218.  Railroads  agree: n*^'  to  pay  one  per  cent  of  gross 
earnings  annually  ror  three  vears;  two  per  cent  for  next  seven  years, 
and  three  thereafter  shall  forjver  be  exempt  f-om  all  other  taxati-  n.  Id. 
347,  and  L,  1887,  ch.  11.  All  railroad  companies  not  acccpiing  this 
or  other  special  provisions  are  to  pay  same  percentage  in  same  manner 
and  be  likewise  exempted,  Id.    See  Suppm't  1888,  p.  214. 

§  20.    MISSISSIPPI.    Constitutional  Provisions.— The  state  shall  not 
pledge  or  loan  its  credit  to  nor  be  a  stockholder  in  an/  corporations 
Art.  XII.,  §  5.    No  corporation  created  by  the  state  shall  issue  money.  Id. 
§  12.     'The  property  of  a'.l  corporauons,  for  pecuniary  profits  shall  be 
subject  to  taxation,  the  same  as  that  of  ihdividuals,"  Id.  §  13.     Muni- 


64 

A  railroad  corn- 
to  investigate  anJ 

meetings  may  be 
yr  call  nr.eeting";  in 
i,  ,        The  tenure 

t  .laws,  Id.  450. 
ti,  amended  1887, 
immigration  com- 
and,  all  to  be  sold 
I  by  forfeiture  on 
ill  be  sold  within 
5,  L.  1881  (see 
ilroad,  canal,  etc., 
04,  Suppm't  1888, 
of  whose  stock  is 
I,  ch.  204,  Supm't 

Is  and  insurance, 
actual  value  of  all 
irporate  realty  and 
84.  The  real  and 
[lares  of  stock  in 
he  state  are  taxed, 
orations  are  taxed, 
state,  Id.  p.  213. 
:e  of  business  is  or 
ixed  on  value  ob- 
ixed,  from  capital 
:herefor  exists  on 
per  cent  of  gross 
next  seven  years, 
other  taxati'  n.  Id. 
lot  accepting  this 
;  in  same  manner 
214. 

The  state  shall  not 
1  any  corporations 
ill  issue  money,  Id. 
ary  profits  shall  be 
•  Id.  §  13.     Muni- 


96 


MIHSISHIPPI. 


»   L'O 


cipalities  shall  not  aid  corporations,  unless  two-thirds  of  its  voters  so 
vote,  Id.  §  14.  Stockholders  are  not  liable  "over  and  above  the  stock 
by  him  or  her  owned,"  unless  the  articles  of  associition  or  act  of  in- 
corporation provide  otherwise,  Id.  §  17. 

Mi8cellaneoiiH  Corporations. — Any  number  may  incorporate  for  man- 
ufacturing purposes.  The  proposed  charter  must  be  published.  The 
governor  must  approve  and  sign  it,  Rev.  Code  1880,  g  1028.  Stock- 
holders shall  not  pay  for  stock  by  their  notes.  Officers  are  liable  for 
loans  to  the  stockholders.  Code  §  1043.  Corporate  debts  shall  not 
exceed  capital  stock.  Officers  are  liable  for  excess,  g  1046.  Under 
the  general  act  as  amended  all  corporations,  except  municipal,  express, 
railroad,  and  telegraph,  may  be  created.  There  is  no  limit  upon  the 
capital  nor  upon  the  number  of  persons.  The  proposed  charter 
shall  be  published  three  weeks  ;  submitted  for  the  governor's  approval 
which  must  be  subscribed  thereto,  and  filed  with  secretary  of  state 
Code  1880,  §§  1027,  1028,  1030  amended,  ch.  26,  L.  1882.  Stock- 
holders are  liable  for  unpaid  subscriptions,  such  liability  to  continue 
one  year  after  transfer,  Code  §  1037.  The  property  and  franchise  are 
salable  under  a  judgment,  the  purchaser  taking  the  rights  of  the  com- 
pany, g  1038.  The  franchise  is  redeemable  within  six  months,  §  1039. 
Foreign  corporations  are  on  the  same  footing  as  domestic,  except 
insurance  companies  which  must  deposit  $25,000.  g§  1042,  1080.  No 
note  or  security  shall  be  taken  in  payment  for  shares.  No  loan  shall 
be  made  to  stockholders.  Making  and  assenting  officers  are  liable 
therefor,  §  1043.  Directors  are  liable  for  excess  of  debts  over  amount 
of  capital,  §  1046.  Capital  may  be  increased.  May  hold  any  amount 
of  real  and  personal  estate,  may  borrow  money  and  issue  bonds,  mort- 
gages and  deeds  of  trust,  ch.  26,  L.  1882.  Charter  may  be  amended 
with  same  formalities  as  when  originally  procured,  the  certified  assent 
of  majority  of  stock  to  accompany  the  application,  and  dissenting  stock 
holders  to  have  thirty  days  to  enjoin,  §  1029  amended,  ch.  86,  L.  1884. 

Hlscellaneons  Proylslons.— Transferers  of  stock  are  liable  on  unpaid 
subscriptions  for  one  year  after  the  sale  or  transfer,  §  1037.  Munici- 
palities may  aid  railroads,  ch.  27,  Laws  1882.  Municipalities  in  six 
specified  counties  may  subscribe  in  any  sum  to  the  capital  stock  of  rail- 
road passing  through  same,  but  only  upon  consent  of  two-thirds  of 
voters  specially  registered  and  voting,  ch.  27,  L.  1884.  A  railroad 
commissioner  is  authorized  to  reduce  rates,  ch.  23,  L.  1884. 

Taxation.— Corporations  are  taxed  on  their  capital  stock  at  their  prin- 
cipal place  of  business,  §  473.  Shares  of  stock  in  corporations  "  not 
required  by  law  to  be  otherwise  listed  and  taxed  "  are  taxed,  §474.  By 
L.   1888,  ch.  3,   amending  §§  557,  585,  Code   1880,  a  tax  of  fioo  is 


21 


MISSOURI. 


66 


wi 


levied  on  each  bank  of  deposit  or  discount  having  capital  stock  or 
assets  of  $10,000  or  less.  $3,000  on  all  having  more  than  $300,000. 
This  ••  privilege  tax  "  is  in  lieu  of  all  other  state  and  municipal  taxes 
upon  shares  and  assets  of  bank.  National  banks  may  accept  this  pro- 
vision, but  if  not,  are  subject  to  ordinary  taxation.  By  L.  1888,  ch.  11, 
all  banks  other  than  national  banks  shall  make  quarterly  reports.  By 
L.  1888,  ch.  63,  amending  §  1030,  Code  1880,  the  charter  fee  shall  not 
be  less  than  $5.00.  Certain  exemptions  are  granted  to  manufacturing 
corporations,  ch.  37,  L.  1880.  Bank  real  estate  is  taxed,  §  585.  A 
special  tax  is  levied  on  all  railroads  in  the  Levee  district  for  levee 
purposes,  L.  1886,  p.  39.  Railroads  are  assessed  by  a  state  board  and 
apportioned  so  that  each  county  collects  its  share,  g§  597,  et  seg.  But 
any  railroad  may  accept  another  act  which  jirovides  for  the  payment 
of  a  privilege  tax  in  lieu  of  all  tax  except  town  and  city  taxes.  This 
privilege  is  specified  for  certain  roads,  and  varies  from  $35  to  $135 
•^Qr  mile,  §§  607,  608,  amended  L.  1884,  ch.  32,  p.  29,  and  L.  1886,  c.  3, 
p.  23,  §  6.  Two-thirds  of  railroad  privilege  taxes  collected  go  to  the 
counties  through  which  the  roads  pass.  All  lands  not  used  for  opera- 
tion of  roads  are  taxed  regularly  where  located,  L.  1884,  p.  30. 

The  "Maryland  Tax  Commissioners"  say  of  Mississippi  :  '*  In  Mis- 
sissipppi  a  license-privilege  tax  is  imposed  by  the  state  on  all  railroads. 
The  statute  fixes  the  sum  per  mile  required  for  each  road,  which  varies 
from  twenty-five  dollars  per  mile  on  the  Mobile  and  Northwestern  Rail- 
road Company  to  one  hundred  and  twenty-five  dollars  per  mile  on  the 
Mobile  and  Ohio  and  other  companies.  The  license  tax  imposed  by 
the  Act  of  1884,  was  increased  twenty-five  per  cent,  by  the  Act  of  1886. 
This  tax  is  in  lieu  of  all  state  and  county  taxes,  and  two-thirds  of  the 
receipts  are  distributed  to  the  respective  counties  through  which  the 
several  roads  run,  in  proportion  to  the  number  of  miles  of  road  in  each 
county  ;  but  cities  and  incoiporated  towns  may  impose  the  same  rate  of 
tax  on  railroad  property  within  their  limits  as  is  levied  upon  all  other 
property  for  municipal  purposes." 

§  21.  MISSOURI.  Constitutional  Provisions.— The  state  shall  not  aid 
any  corporation.  Art.  IV.,  §g  45,  46,  49.  The  legislature  shall  not 
authorize  any  municipality  to  aid  corporacions.  Art.  IV.,  §  47.  Special 
laws  shall  not  create  corporations,  or  grant  right  to  lay  down  railroad 
tracks.  Art.  IV.,  §53.  Municipalities  shall  not  aid  railroads  or  other 
coi>orations.  Art.  IX.  g  6.  The  power  to  tax  corporations  shall  not  be 
contracted  away,  Art.  X.,  §  2.  Railroads  shall  be  taxed  on  their  realty 
and  personalty,  "and  on  their  gross  earnings,  net  earnings,  their  fran- 
chises and  their  capital  stock,"  Art.  X.,  §5.'  Corporations  shall  pay 
'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,   chapter  xxxiv. 


56 


«7 


MISSOURI. 


§  21 


capital  stock  or 
•re  than  $200,000. 
I  municipal  taxes 
f  accept  this  pro- 
ly  L.  1888,  ch.  II, 
terly  rejiorts.  By 
larter  fee  shall  not 
to  manufacturing 
taxed,  §  585.  A 
li strict  for  levee 
a  state  board  and 
597,  et  seg.  But 
for  the  payment 
city  taxes.  This 
rom  $25  to  $125 
and  L.  1886,  c.  2, 
)llected  go  to  the 
t  used  for  opera- 
J4,  p.  30. 

issippi  :  '*  In  Mis- 
eon  all  railroads, 
oad,  which  varies 
brthwestern  Rail- 
>  per  mile  on  the 
se  tux  imposed  by 
r  the  Act  of  1886, 
two-thirds  of  the 
lirough  which  the 
s  of  road  in  each 
t  the  same  rate  of 
ed  upon  all  other 

state  shall  not  aid 
:islature  shall  not 
v.,  §  47.  Special 
lay  down  railroad 
railroads  or  other 
tions  shall  not  be 
:ed  on  their  realty 
rnings,  their  fran- 
orations  shall  pay 
..aw,  chapter  xxxiv. 


for  filing  certificate  of  incorpt-ration  $50  for  a  capital  stock  of  $50,000 
or  less,  and  $5  for  every  additi  jnnl  $io,ooo,  Art.  X.  {|  21.     No  sjiecial 
laws  shall  create  corporations,  Art.  XII.,  §2.     Cumulative  voting  for 
directors  must  prevail  with  all  corporations.  Art.  XII.,  Jj  6.'    Fictitious 
bonds  and  stock  are  void,  Art.   XII.,  §  8.a   Stockholders  shall  not  be 
liable  on  stock  "  in  any  amount  over  or  above  the  amount  of  stock 
owned  by  him  or  her,"  Art.  XII.,  55  9.     No  corporation  shall  issue  pre- 
ferred stock  without  the  consent  of  all  the  stockholders,  Art.  XII  ,  g  10. 
A   book  containing  the   names  of  stockholders,  etc.,   and  assets  and 
liabilities   of   the   corporation   is   to   be    kept   in   the   state   and  open 
to  public  inspection.'     The  directors  of  any  railroad  company  shall  hold 
one  meeting  annually  in  the  state.  Art.  XV.,y  15.    Rolling  stock  shall  be 
personalty  and  subject  to  execution  as  such.  Art.  XII.,  §  16.    'I'he  con- 
solidation, lease,  purchase  or  control  of  competing  or  parallel  line  is 
prohibited.  Art.  XII.,  §  17.     Consolidation  with  a  foreign  corporation 
shall  not  make  a  railroad  a  foreign  corporation.     Jurisdiction  of  the 
state  courts  is  to  remain,   Art.    XII.,  §  18.     Officers   shall  not  be  in- 
terested,  directly  or  indirectly,  in  furnishing  supplies  or  material  to  the 
corporation,  nor  in  transportation  companies  doing  business  with  the 
corporation.  Art.  XII.,  §22.''     Passes  to  state  or  municipal  officers  or 
legislators   are   prohibited.  Art.   XII.,  §  24.     Banking   laws   must   be 
approved  by  a  vote  of  the  people  before  enforcement,  Art.  XII.,  §  26. 
It  is  a  criminal  offence  for  a  bank  officer  to  receive  deposits  after  he 
knows  the  bank  to  be  insolvent  or  in  failing  circumstances.     Officer  is 
also  liable  personally.  Art.  XII.,  §  27. 

Miscellaneons  Corporations.— Three  or  more  may  incorporate  for  any 
money-making  purpose,  consistent  with  the  laws  of  the  state.     Articles 
must  state  that  full  capital  stock  has  been  subscribed  bona  fide  and  one- 
half  actually  jiaid  for  in  lawful  money.    May  incorporate  for  fifty  years, 
Id.  §  926.     Mining  companies  not  to  be  incorporated  until  a  bond  is 
executed  to  the  state,  conditioned  that  the  corporation  will  truly  pay  all 
wages  due  employes  and  for  supplies  durmg  the  first  year,  L.  1887,  PP-  109, 
110,  amending  §  926,   R.  S.      Cumulative    voting  provided  for,    Id. 
§   930.»     Capital      stock     may     be     from    .$2,000     to     $10,000,000. 
Directors  to  be  stockholders  and   one  a  dona  fide  citizen  of   the  state,' 
I^-  §  93°-     Books  to  be  open  ro  inspection  of  stockholders.  Id.  §932. 
Corporation  shall  not  loan  money  to  stockholders  and  stock  shall  not  be 
paid  by  note.  Id.  §  933.     The  circuit  court  is  given  extensive  powers  to 
remove  or  punish  or  compel  directors  to  pay  back  money  in  case  of  mis- 
*Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxvii. 
•/</. ,  chapter  iii.  •/</. ,  chapter  xxx.  *  /d. ,  chapter  xxxix. 

'  Id.,  chapter  xxxvii.  '/</.,  chapter  xxxvii. 


.11 


»  21 


MISHOl'KI. 


68 


fcasar.ci!,  nialft-'asaiuH- i)r  nonfeasance  by  them;  aiul  to  order  new  elec- 
tions, 5}  948.' 

UullroiulH.— Fivoor  more  may  incorporate,  Id.  ^  764.  May  lake  sub- 
scriptions redeemable  in  transportation,  and  may  issue  interest-bearing 
certificates  tiierefor,  Id.  J$J5  77J,  etc.  Consolidations  authorized,  Id. 
g  789.  As  to  purchase,  lease  or  traffic  arrangemeuf  authorized  l)etween 
railroads  within  the  state  and  in  adjoininj,'  states  see  Id.  g  790,  amended 
L.  1887,  sp.  sess.,  p.  10.  Railroads  are  regulated  as  to  discriminations, 
etc.,  l)y  L.  1887,  pp.  15  ef  seq.  All  consolidations,  l<;ases  and  purchases, 
of  parallel  or  competing  railroad  lines  are  prohibited,  I..  1887,  p.  io» 
Railroad  company  may  issue  bonds  in  excess  of  its  capital  stock  for 
purpo.sc  of  constructing  or  acquiring  a  connecting  railroad,  but  such 
bonds  shall  not  exceed  authorized  capital  of  the  constructed  or  acquired 
railroad,  1 .  1887,  *p.  sess.,  p.  8,  amending  §  727,  R.  S.  A  railroad  com- 
missioner is  authorized  to  reduce  rates,  R.  S.,  §  842,  etc.  Discrimina- 
tions by  railroads  in  regard  to  express  companies  are  forbidden.  Act  of 
April  8,  1889.  Shippers  of  live  stock  are  to  be  carried  free  of  charge, 
when  they  accompany  the  shipment,  Act  of  June  12,  1889.  Railroad* 
shall  not  charge  more  for  a  carload  of  mixed  freight  than  for  a  carload 
of  the  highest  grade  of  such  freight;  nor  shall  they  charge  more  for  less 
than  a  carload  than  they  charge  for  a  full  carload  of  the  same  freight. 
Act  of  May  6,  1889. 

Banks.— Five  or  more  may  incorporate  a  bank  of  deposit  and  dis- 
count, R.  S.  1879,  §  901.  Written  articles  are  to  be  executed,  ac- 
knowledged and  recorded,  spjcifying  proposed  location,  the  capital 
stock  and  that  one-half  thereof  's  actually  paid  in,  §  902.  The  cash 
capital  shall  not  be  less  than  $10,000  nor  more  than  $5,000,000,  and  in 
a  city  of  150,000  inhabitants  not  less  than  $100,000,  §  904.  On  trans- 
fer of  shares  the  vendor,  as  well  as  the  vendee,  continues  liable  for  one 
year,  §  905.  Directors  must  be  residents  of  the  state  and  bona  fide 
owners  of  two  shares,  and  no  person  shall  be  director  in  two  such  banks 
at  the  same  time,  §  906.  Certificate  of  incorporation  invalid  if  capital 
stock  therein  mentioned  is  not  bona  fide  subscribed  and  one-half  paid 
in,  §  907.  The  remainder  must  be  paid  in  within  one  year,  §  908. 
Secretary  of  state  may  call  upon  board  for  detailed  statement  of  affairs 
at  any  time  and  same  shall  be  published.  Such  reports  must  be  made 
at  least  twice  each  year,  §§  909-912.  No  bank  shall  become  the 
creditor  of  any  person  or  corporation  in  a  sum  exceeding  twenty-five 
per  cent,  of  its  paid-up  capital,  nor  loan  more  than  twenty-five  per  cent 
of  its  capital  on  the  security  of  any  officer  without  sufficient  collateral 
security  or  mortgages,  §  916. 
'Cook  on  Stock  ami  Stockholders  and  General  Corporation  Law,  chapter  xxxix. 


()  order  new  elcc- 

4.  May  take  siib- 
e  interest-bearing 
IS  autliorizeil,  Id. 
iithorized  l)etween 
Id.  S  790,  amended 
to  discriminations, 
ses  and  purchases, 
d,   I,.  1887,  p.  io» 

capital  stock  for 
railroad,  but  such 
ructed  or  acquired 
3.  A  railroad  com- 

etc.     Discrimina- 

forbldden,  Act  of 
icd  free  of  charge, 
,  1889.     Railroads 

than  for  a  carload 
^large  more  for  less 

the  same   freight, 

F  deposit  and  dis- 

bc  executed,  ac- 
ation,  the  cajMtal 
^  902.  The  cash 
$5,000,000,  and  in 
§  904.  On  trans- 
nues  liable  for  one 
state  and  bona  fide 

in  two  such  banks 
1  invalid  if  capital 
and  one-half  paid 

one  year,  §  908. 
statement  of  affairs 
)rts  must  be  made 

shall  become  the 
:eeding  twenty-five 
venty-five  per  cent 
sufficient  collateral 

1  Law,  chapter  xxxix. 


50 


MONTANA. 


8   2'. 


<ii>ii(>ral  rr«vlHloiiH.— Duration  limited  to  twenty  years,  unless  other- 
wise provided,  |$  706.  Sul)scrd)ers  are  to  pay  five  per  cent,  of  sub- 
scription in  money  at  time  of  sul)stril)ing,  ^  711.  Only  the  stockhold- 
ers registercil  as  surh  for  thirty  ilays  have  right  to  vote,  g  710.  During 
that  time  the  transfer  book  is  to  be  open  to  inspecli(>n,  }}  720.'  I'erson 
complaining  of  an  election  may  apply  to  the  courts  for  such  redress  a!' 
it  may  deem  fit,  |5|$  722,  723.  The  bonds  of  the  corpoiation  are  not  '.o 
exceed  in  amount  its  ca|)ital  stock,'  g  727,  cf.  railroads  iupra.  Justice 
of  the  peace  may  call  a  cor|Mjrate  meeting  in  certain  cases,  {5  733.  Kx- 
ecution  against  the  corporation  unsatisfied  may  be  satisfied  out  of  a 
stockholder's  property,  to  the  extent  of  his  unpaid  subscription,  after  due 
notice  to  him  of  intent  to  levy,  J}  736.  Private  corporations  may 
amend  articles  of  incorporation,  Act  March  21,1881.  Trusts  are  for- 
bidden under  heavy  penalties,  Act  of  May  18,  1889.  dambling  in 
stocks,  there  being  no  intent  to  deliver  is  prohibited  under  heavy  pen- 
allies,  Act  of  May  9,  1889. 

Tftxat'on.s— P'or  filing  certificate  of  incorporation  see  constitutional 
provision,  supra.  Business  and  other  miscellaneous  corporations  are 
taxed  on  their  tangible  personal  and  real  property.  Banks  and  insur- 
ance companies  are  taxed  through  the  shares  of  stock,  g  6692.  Shares 
of  stock  are  not  taxed,  if  both  the  capital  stock  and  the  tangible  corporate 
realty  and  personalty  are  taxed  against  the  corporation,  g  6713.  Other- 
wise shares  of  stock  are  taxed,  g  6664.  Railroads  are  taxed  on  repair 
shops,  round  houses,  etc. ,  etc.,  where  they  exist.  The  right  of  way, 
track,  rolling  stock,  and  depots  are  assessed  by  a  state  board  and 
apportioned  among  the  municipalities,  g§  6865,  etc.  Foreign  insurance 
companies  must  make  a  deposit  of  $200,000,  except  accident  companies, 
which  c!„jK)sit  $100,000,  Id.  g  6008,  amended  L.  1883,  p.  99,  of  their 
gross  receipts.  Act  of  May  16,  1889. 

g  22.  MONTANA.— This  was  a  territory  until  February,  1889,  when 
it  was  admitted  into  the  Union.  'I'he  constitution  as  framed  by  the 
convemion  in  August,  1889,  for  submission  to  the  people,  contains  the 
followmg  provisions  : 

Constitntional  Pro.'sions — There  shall  be  no  grant  of  special  privi- 
leges, franchises  or  immunities,  Art.  III.,  g  11.  No  special  law  shall  be 
passed  chartering  banks,  insurance  companies  or  loan  and  trust  com- 
panies ;  or  granting;  to  any  corporation,  association  or  individual  the 
right  to  lay  down  railroad  tracks,  or  any  special  or  exclusive  privilege, 
immunity  or  franchise  whatever  ;  or  exempting  property  from  taxation, 
Art.  v.,  §  26.     No  act  shall  " delegate  to  any    .    .    .    private  corpora- 

'Cook  on  Stock  and  Stockholders  and  General  Corporation    Law,  chapter  xxx. 
'/</.,   chapter  xli.  V./.,  chapter  xxxiv. 


§  22 


MONTANA. 


60 


tion  or  association  any  power  to  make,  supervise  or  interfere  with  any 
municipal  improvements,  money,  property  or  effects,"  Id.  §  36.  No 
act  shall  authorize  executors,  administrators,  guardians  or  trustees  to 
invest  trust  funds  in  the  bonds  or  stock  of  any  private  corporation.  Id. 
§37.  No  act  shall  authorize  the  state  or  any  municipality  "  to  con- 
tract any  debt  or  obligation  in  the  construction  of  any  railroad,  nor 
loan  its  credit  to  or  in  aid  of  the  construction  of  the  same,"  etc.  Id. 
§  38,  and  Art.  XIII.,  §1.  The  power  to  tax  corporations  shall  not  be 
relinquished,  Art.  XII.,  §  7.  The  franchise,  roadway,  roadbed,  rails 
and  rolling  stock  of  railroads  shall  be  assessed  by  a  state  board  and  the 
amount  apportioned  among  the  municipalities  in  which  the  railroad  is 
located,  Id.  §  16.  Stocks  shall  be  taxed  unless  the  corporate  property 
represented  by  such  stock  is  within  the  state  and  has  been  taxed,  Id. 
§  17.  Special  acts  of  incorporation  are  prohibited.  Art.  XV.,  g  2. 
Charters  may  be  altei'ed,  revoked  or  annulled.  Id.  §  3.  Cumulative 
voting  shall  be  allowed,  Id.  §  4.  The  legislature  may  reduce  rates. 
Id.  §5.  Consolidation  or  pools  of  competing  or  parallel  railroads, 
express  or  transportation  companies  are  prohibited.  Such  companies 
shall  not  have  the  same  persons  as  officers.  Id.  §  6.  Discriminations 
are  prohibited.  Id.  §  7.  "  Watered  '"  stock  and  bonds  are  void.  Any  in- 
crease of  stock  must  be  by  a  majority  stock  vote  duly  notified.  Id.  §  ic 
Foreign  corporations  shall  not  do  business  in  the  state  unless  they  have 
an  office  and  agent  to  accept  service  in  the  state.  Foreign  corpora- 
tions shall  exercise  no  greater  powers  than  domestic  corporations  have. 
Id.  §  II.  Street  railroads  shall  be  built  only  with  the  consent  of  the 
municipal  authorities.  Id.  §  12.  Telegraph  lines  may  be  constructed. 
Consolidation,  etc.,  of  competing  telegraph  or  telephone  companies 
is  forbidden,  id.  §  14.  Corporations  shall  not  cause  employes  to 
contract  against  corporate  liability  for  injuries,  Id.  §  16.  "Trusts" 
or  contracts  "  for  the  purpose  of  fixing  the  price,  or  regulating  the 
production  of  any  'article  of  commerce,  or  of  the  product  of  the  soil, 
or  consumption  by  the  people  "  are  prohibited,  Id.  §  20. 

The  following  is  a  statenient  of  the  territorial  law  of  Montana  : 
miscellaneous  Corporationg,— Three  or  more  may  incorporate  to  carry 
on  any  "  branch  of  business  designed  to  aid  in  the  industrial  or  product- 
ive interests  of  the  country  and  the  development  thereof"  by  making, 
signing,  acknowledging  and  filing  proper  certificate.  Compiled  Statutes, 
1086,  §§  446,  447.  If  to  do  business  outside  of  territory,  the  cer- 
tificate shall  so  state,  §  449.  Trustees  (three  to  nine)  shall  be  stock- 
holders. Cumulative  voting  provided  for,  §  450.  Trustees  may  make  by- 
laws, §  454.  Stock  is  personal  estate  and  a  transfer  is  not  valid  except 
between  parties,  until  recorded,  §  455.     Stockholders  are  liable  tor  un- 


aigm 


60 

interfere  with  any 
:s,"  Id.  §  36.  No 
ians  or  trustees  to 
ite  corporal' on,  Id. 
inicipality,"  tocon- 
af  any  railroad,  nor 
the  same,"  etc.  Id. 
ations  shall  not  be 
ivay,  roadbed,  rails 
state  board  and  the 
lich  the  railroad  is 

corporate  property 
has  been  taxed,  Id. 
;d,  Art.  XV.,  g  2. 
.  §  3.     Cumulative 

may  reduce  rates, 
parallel  railroads, 
.  Such  companies 
>.  Discriminations 
ds  are  void.  Any  in- 
jT  notiSed,  Id.  §  ic 
ite  unless  they  have 
Foreign  corpora- 
:  corporations  have, 
the  consent  of  the 
lay  be  constructed, 
^lephone  companies 

cause  employes  to 
.  §  16.  ''Trusts" 
;,  or  regulating  the 
product  of  the  soil, 

§20. 

V  of  Montana  : 

incorporate  to  carry 
idustrial  or  product- 
ereof "  by  making. 

Compiled  Statutes, 

territory,  the  cer- 
ne)  shall  be  stock- 
istees  may  make  by- 
r  is  not  valid  except 
:rs  are  liable  for  un- 


61 


MONTANA. 


22 


paid  subscriptions,  §  457.  Trustees  may  is'suc  stock  a-  fully  paid  by 
purchase  of  property,  §  458.  Annual  rejKjrt  to  be  made  and  on  failure 
to  make  it  the  trustees  are  liable,  §  460.  Trustees  also  liable  if  they 
declare  dividend  wh;;n  company  is  insolvent,  g  461.  No  loan  shall  be 
made  to  stockholders.  If  made,  all  assisting  or  assenting  are  liable  for 
all  debts  until  repaid,  §  462.  False  report  or  notice  makes  signers 
liable,  §  463.  Capital  may  be  increased  and  business  changed  at 
properly  noticed  meeting  by  a  two-thirds  stock  vote,  §§  468,  469.  Trus- 
tees  are  liable  for  excess  of  indebtedness  over  the  amount  of  capital, 
§470.  Stockholders' book  to  be  kept  under  penalty,  g  471.  Fifteen 
per  cent  of  stock  may  demand  sworn  statement  of  affairs  from 
treasurer,  §  472.  Corporations  may  hold  real  estate  necessary  for 
their  purposes,  §  482.  Corporation  may  purchase  its  own  shares  on 
a  forfeiture  of  stock,  §  508. 

Railroads. — Five  or  more  may  form  a  railroad  company,  §  677,    By 
executing,  acknowledging  and  filing  certificate,  §  668.     Shares  of  stock 
are  personalty  subject  to  execution.     Ten  per  cent,  shall  be  paid  down 
and  the  residue  in  installments  not  exceeding  twenty-five  per  cent,   nor 
m(  re  often  than  every  three  months,  §  681      Five  directors  are   to  be 
elected  as  soon  as  five  per  cent  of  the  capital  is  subscribed,  each  share 
having  one  vote  and  a  majority  electing,  §  683.    A  railroad  may  borrow 
money  not  to  exceed  the  authorized  capital;  may  issue  bonds  and  exe- 
cute mortgages  to  cover  after-acquired  property,  §  691.    Shall  establish 
principal  office  on  the  line  of  the  road,   §  694.      Neither  the  territory 
nor  municipalities  are  to  be  responsible  for  railroad  obligations,  §  696. 
Directors  on  the  vote  of  the  stockholders  may  increa.^,e  the  capital  stock' 
§  698.     An  annual  report  is  to  be  made  for  which  the  statute  provides 
an  outline  of  fifty-six  items,  §  701.     A  foreign  railroad  may  extend  its 
line  into  Montana  after  filing  a  copy  of  its  directors'   resolution  desig- 
nating the  route,  etc.,  §  702.     Two  or  more  railroads  may  consolidate 
by  articles  of  agreement  entered  into  under  the  corporate  seals  and  the 
officers'  signatures  and  ratified  by  three-fifths  of  the  outstanding  capital 
stock  of  each  company,  §  703.     May  lease  or  purchase  continuous  or 
connecting  lines  in  the  same  manner,  §  704.      May  "  create,  issue  and 
dispose  of  such  amount  and  character  of  special,  preferred  or  full 
paid  stock  of  the  capital  stock     .      .     as  may  be  deemed  advisable  by 
its  board  of  directors,"  §  705.     Any  railroad  in  the  territory  may  issue 
and  secure  bonds,  etc.     Mortgages  and  deeds  of  trust  may  be  recorded 
with  the  secretary  of  territory  which  shall  suffice  as  notice  without 
further  record,  §  706. 

Banks.— Banks  of  discount  and  deposit  may  be  incorporated  by  three 
or  more  subject  to  the  general  act.     Capital  to  be  not  less  than  $20,000 


1 

J 

I 
h 

^ 


f.  !r 


22 


MONTANA. 


which  must  oil  be  paid  in  cash  before  the  territorial  certificate  of  autho- 
rization will  issue,  §  514.  A  list  of  the  stockholders  is  to  be  filed  with 
the  auditor,  §  515.  A  bank  is  not  to  purchase  its  own  or  other  1  lock 
except  to  secure  debts,  §  516.  Directors  must  all  be  citizens  of  the 
United  States,  and  three-fourths  are  to  be  residents  of  the  territory. 
Each  must  own  ten  shares  and  take  an  oath.  "  Stockholders  in  all  elec- 
tions of  directors  and  in  deciding  all  questions  at  stockholders'  meet- 
ings, shall  be  entitled  to  one  vote  on  each  share  of  stock  held,  and  may 
vote  said  stock  by  proxy  duly  authorized  in  writing,"  §  518.  The 
bank  has  a  lien  on  shares  for  debts  due  it  from  the  holder,  §  519.  Di- 
rectors are  liable  for  neglect  to  publish  semi-annual  reports,  §  522. 
Officers  and  stockholders  are  individually  liable  to  the  extent  of  their 
respective  shares,  "except  that  when  any  stockholder  shall  sell  and 
transfer  his  stock  such  liability  shall  cease  at  the  expiration  of  six 
months  from  and  after  the  date  of  such  sale  and  transfer,"  §523.  The 
total  liability  of  any  person  or  firm  to  a  bank  shall  not  exceed  fifteen  per 
cent  of  the  paid-up  capital  and  surplus,  §  529.  Must  keep  twenty  per 
cent  of  its  immediate  liabilities  in  available  funds,  §  530.  Banks  under 
this  act  are  taxed  as  national  banks,  "  the  stock  to  pay  its  share  of  the 
revenue  whether  held  in  the  territory  or  not,"  §  531.  Corporations  of 
three  or  more  may  be  formed  for  <' trust,  deposit,  security  and  loaning 
business,"  with  a  capital  of  not  less  than  $too,ooo,  §§  532-563. 

Foreii^n  Corporations.— Ail  foreign  corporations  shall  file  a  copy  of 
their  charters  duly  authenticated,  also  a  verified  statement  of  their  con- 
dition and  an  agreement  consenting  to  be  sued  in  the  territory  and 
designating  a  resident  agent,  whose  consent  shall  also  be  filed,  §§  442, 
443.  Penalty  is  incurred  for  failure  so  to  do,  §  444.  Annual  report  of 
condition  is  to  be  made,  §  445- 

Taxation.— Stocks  and  shares  of  all  banks  and  companies,  domestic  or 
foreign,  located  in  or  out  of  the  territory  are  taxed  except  where  the  en- 
tire capital  stock  is  invested  in  assessable  property  in  Montana,  L.  1887, 
p.  84.  §  4.  Railroad,  canal,  and  similar  property  is  taxed  where  it  is 
located  and  on  the  basis  of  sworn  statements  to  be  made  by  corporate  offi- 
cers Id.  p.  86,  §  8.  Depreciated  stocks  are  assessed  at  their  cash  value, 
Id.  §  10.  All'  bank  shares  are  taxed  where  the  bank  is  situated  upon 
their  actual  value  determined  by  deducting  the  real  estate  from  the 
capital  and  surplus.  Such  real  estate  is  taxed  as  other  real  estate 
Local  holders  of  foreign  national  bank  shares  are  not  taxed  thereon.  Id. 
§  12.  Shares  of  storl  are  taxed.  Id.  p.  89,  §  16.  Mines  are  taxed  on 
their  net  proceeds.  Id.  pp.  100,  loi.  The  fee  of  the  territorial  secretary 
for  filing  a  certificate  of  incorporation  is  $2.00,  §  1969,  Comp. 
L.  1887. 


iiin 


62 

rtificate  of  autho- 
i  to  be  filed  with 
n  or  other  lock 
be  citizens  of  the 

of  the  territory, 
lolders  in  all  elec- 
ockholders'  meet- 
ck  held,  and  may 
>g,"  §  518.  The 
older,  §519.  Di- 
al  reports,  §  522. 
le  extent  of  their 
ler  shall  sell  and 

expiration  of  six 
ifer,"  §523-  The 
exceed  fifteen  per 
t  keep  twenty  per 
130.  Banks  under 
ly  its  share  of  the 
Corporations  of 
;urity  and  loaning 

5  532-563. 

hall  file  a  copy  of 
ment  of  their  con- 
the  territory  and 

o  be  filed,  §§  442, 
Annual  report  of 

panies,  domestic  or 
cept  where  the  en- 
Montana,  L.  1887, 
taxed  where  it  is 
le  by  corporate  offi- 
at  their  cash  value, 
k  is  situated  upon 
:al  estate  from  the 
other  real  estate 
taxed  theieon,  Id. 
lines  are  taxed  on 
territorial  secretary 
o.    §   1969,  Comp. 


63 


NEBRASKA. 


§  23 


§  23.  NEBRASKA.  Constitutional  Provisions.— Local  or  special 
laws  granting  to  any  corporation  the  right  to  lay  down  a  railroad  track 
or  any  special  or  exclusive  privileges,  immunities  or  franchises  are  pro- 
hibited. Art.  III.,  §  15.  The  state  shall  not  denote  land  to  any  cor- 
poration. Id.  §  18.  "  Every  person  and  corporation  shall  pay  a  tax  in 
proportion  to  the  value  of  his,  her,  or  its  property  franchises,"  Art.  IX., 
§  I.  Corporations  shall  not  be  released  or  discharged  from  taxation, 
Art.  IX.,  §  4.  Railways  are  declared  to  be  public  highways.  Maximum 
rates  may  be  fixed  by  law.  The  liability  of  railroad  corporations  as 
common  carriers  shall  never  be  limited.  Art.  X.,  §  4.  Railroad  cor- 
porations doing  business  in  the  state  must  keep  a  book  for  public  in- 
spection containing  the  names,  etc.,  of  the  stdckholders  and  a  statement 
of  the  assets  and  liabilities  of  the  corporation  and  make  an  annual  re- 
port i  ideroath.  Art.  XI.,  §  i.  The  rolling  stock  of  corporations  is  sub- 
ject to  execution.  Id.  §  2.  Consolidations  of  competing  or  parallel 
lines  are  forbidden  and  no  consolidation  at  all  without  sixty  days 
notice.  Id.  §  3.  Fictitious  stock  and  bonds  and  all  stock  dividends  are 
void,  Id.  §  5.  Foreign  railroad  corporations  shall  not  exercise  the 
right  of  eminent  domain,  until  they  incorporate  in  the  state,  Id.  §  8. 
No  municipality  shall  subscribe  for  or  own  stock  in  any  corporation. 
Id.  §  I.  Street  railways  shall  be  allowed  only  upon  a  majority  vote  of 
the  electors.  Id.  §  2.  No  corporation  shall  be  created  by  special  act,  Id. 
§  I.  Stockholders  shall  be  liable  for  unpaid  subscriptions.  Transferees 
shall  also  be  liable,  Id.  §  4.  Cumulative  voting  is  provided  for,  Id. 
§  5.  Stockholders  in  banks  are  liable  to  the  extent  of  their  stock,  in 
addition  to  their  subscriptions,  for  liabilities  accruing  while  they  are 
stockholders.  All  banks  shall  publish  quarterly  statements  under  oath. 
Id.  §  7.      The  state  shall  not  aid  corporations,  Art.  XII.,  §  3. 

Miscellaneous  Corporations, — Any  number  may  incorporate  for  any 
lawful  business.  Com.  Stat.  1887,  p.  255.  The  articles  of  incorporation 
must  fix  the  limit  of  indebtedness,  which  must  not  exceed  two-thirds  of 
the  capital  stock,  except  insurance  risks,  bank  deposits  and  funds  of 
trust  companies  in  certain,  cases.  Companies  may  hold  real  estate 
necessary  for  legitimate  business,  p.  256.  Notice  of  incorporation  must 
be  published  for  four  weeks.  Id.  Amendments  also  are  to  be  published. 
Annual  statements  of  debts  are  to  be  published,  on  a  penalty  of  the 
stockholders  being  liable  for  all  debts,  p.  257.  If  the  incorporation 
is  irregular,  the  stockholders  are  liable  for  all  debts.  Id.  For  deception 
as  to  resources  or  liabilities,  a  penalty  is  imposed.  Id.  Manufacturing 
corporations  may  be  incorporated  under  a  different  act,  p.  237. 
Directors  then  must  be  stockholders.  Id.  Trusts  and  combinations  in 
trade  are  prohibited,  ch.  69,  L.  1889. 


§24 


NEVADA. 


U 


ws> 


Rallroadfl. — Five  or  more  may  incorporate,  Id.  243.  Ten  per 
cp.nt  on  each  share  is  payal)le  at  the  time  of  subscription,  244. 
The  capital  may  be  increased  by  a  majority  stock  vote  on  sixty  days' 
notice,  244.  Consolidations  authorized,  246.  But  dissenting  Ftock- 
holders  must  be  paid  the  market  value  of  their  stock,  247.  Leases 
of  railroads  are  also  authorized,  248,  Stockholders  are  individually 
liable  only  for  unpaid  subscriptions,  253.  Domestic  railroads  may 
consolidate  with  any  non-comi)eting  railroad  in  an  adjoining  state, 
253i  254-  May  execute  mortgages  and  deeds  of  trust  and  issue  bonds 
convertible  into  stock,  254.  A  railroad  commissioner  has  power 
to  prevent  discrimination,  etc.,  and  to  investigate  and  report,  ch.  60, 
L.  1887.  Connecting  railroads  may  subscribe  to  each  other's  stock,  or 
one  may  lease  or  purchase  the  other,  upon  a  two-thirds  vote  of  all  the 
stock  of  each  company,  ch.  89,  L.  1889. 

Taxation. — Shares  of  stock  and  also  the  capital  stock  are  taxed.  Id. 
.  585.  But  when  the  capital  stock  is  taxed  the  shares  of  stock  are  not, 
586.  The  capital  stock  is  taxed  at  the  principal  place  of  business. 
Id.  All  domestic  corporations  in  addition  to  the  tax  on  their  person- 
alty and  realty,  are  taxed  on  the  capital  stock.  It  is  valued  at  the 
market  value  of  al!  the  shares  of  stock,  less  the  valuation  of  the 
rr-.lty  and  personalty,  which  are  otherwrse  taxed,  590,  591.  Bank 
stock  is  taxed  and  the  tax  is  paid  by  the  bank,  591.  Railroads 
are  assessed  by  a  state  board  on  all  their  property  used  for  railroad 
purposes,  and  the  assessment  is  apportioned  among  the  counties 
through  which  they  run,  592.  Insurance  companies  are  taxed  on 
the  annual  excess  of  premiums  over  losses  and  ordinary  expenses,  592. 

§  34.  NEVADA.-Constltutlonal  Provisions.—"  The  legislature  shall 
pass  no  special  act  in  any  manner  relating  to  corporate  powers,  ex- 
cept for  municipal  purposes."  Art.  VIII.,  §  i.  "All  real  prop- 
erty and  possessory  rights  to  the  same,  as  well  as  personal  property 
in  this  state,  belonging  to  corporations,  now  existing  or  hereafter 
created,  shall  be  subject  to  taxation  the  same  as  property  of  indi- 
viduals," Id.  §  2.  "  Corporators  in  corporations  formed  under  the 
laws  of  this  state  shall  not  be  individually  liable  for  the  debts  or 
liabilities  of  such  corporations,"  Id.  §  3.  The  state  shall  not 
give  or  loan  its  money  or  credit  to  or  own  stock  in  corporations.  Id. 
§  9.  Counties,  towns,  etc.,  shall  not  be  stockholders  in  any  corpora- 
tion whatever,  or  loan  their  credit  in  aid  of  any  such  corporation  isxcept 
railroad  corporations.  Id.  §  10. 

Miscellaneons  Corporations.— May  be  formed  for  a  variety  of  speci- 
fied purposes,  "  or  for  the  purpose  of  engaging  in  any  other  species  of 


<H 


64 

1.  243-  Ten  per 
subscription,  244. 
ote  on  sixty  days* 
dissenting  Ftock- 
)ck,  247.  Leases 
s  are  individually 
lie  railroads  may 
1  adjoining  state, 
:  and  issue  bonds 
sioner  has  power 
id  report,  ch.  60, 
li  other's  stock,  or 
ds  vote  of  all  the 

ock  are  taxed.  Id. 

,  of  stock  are  not, 

place  of  business^ 

;  on   their  person- 

t  is  valued  at  the 

valuation  of    the 

590,  591.     Bank 

,591.      Railroads 

used  for  railroad 

ong   the    counties 

lies  are    taxed  on 

ary  expenses,  592. 

he  legislature  shall 
porate  powers,  ex- 
"AU   real  prop- 
personal  property 
ting   or    hereafter 
property  of  indi- 
formed  under  the 
for  the  debts  or 
;    state   shall  not 
corporations,  Id. 
rs  in  any  corpora- 
corporation  except 

a  variety  of  speci- 
y  other  species  of 


65 


NEVADA. 


g  24 


trade,  business  or 'commerce,  den.  Stat.  1885,  ch.  8,  §802.  Three 
or  more  persons  may  incorporate  by  making,  signing,  acknowledging 
and  recording  articles,  §  803.  May  hold  necessary  real  estate,  g  804. 
Trustees  must  be  stockholders.  Meetings  for  elections  must  be  within 
the  state.  Cumulative  voting  provided  for.  At  any  time  on  a  written 
application  of  a  majority  of  the  stock  to  a  specified  judge,  a  meeting 
will  be  held  before  the  judge,  and  a  majority  of  the  stock  may  remove 
a  trustee  and  elect  another  instead,  §  806. 

Married  woman  may  transfer,  etc.,  her  stock  the  same  as  though  un- 
married, §  810.  Debts  must  not  exceed  the  amount  of  the  capital  stock 
actually  paid  in,  and  directors  are  liable  for  any  excess,  g  815.  All 
books  of  the  company  shall  be  open  to  the  inspection  of  stockholders 
at  all  times  except  holidays,  etc.,  §  817.  i.'ay  increase  or  diminish  the 
capital  stock,  §  819.  Subscriptions  to  mining  corporations  may  be  paid 
for  by  mines,  §  825.  Corporations  for  mining,  milling  and  ore  reduc- 
tion  may  subscribe  to  stock  of  certain  incidental  companies,  §  829, 
Foreign  corporations  doing  business  in  the  state  must  appoint  an  agent 
in  the  state  to  accept  service  of  papers,  ch.  44,  L.  1889. 

Railroads.— Ten  persons,  "  either  in  this  state  or  the  United  States," 
being  subscribers,  etc.,  ma)'  incorporate  upon  the  subscription  of  at 
least  $1,000  a  mile  and  the  payment  of  ten  per  cent  thereof,  §  834.  The 
annual  meeting  must  be  in  one  of  the  counties  through  which  the  road  runs. 
Stockholders  voting  must  have  owned  the  stock  for  ten  days.  Directors 
must  be  stockholders  and  majority  must  be  residents  at  the  time  of  the 
election,  §  838.  At  any  general  meeting,  a  director  or  president  may 
be  removed  by  two-thirds  of  the  stock,  notice  having  been  given,  §  841. 
By-laws  are  made  by  directors  and  approved  by  a  majority  of  the  stock- 
holders, §  843.  All  corporate  debts  are  to  be  recorded  in  a  registry, 
which  shall  be  open  to  the  stockholders  or  creditors,  and  when  paid,  a 
memorandum  is  to  be  made.  ''  No  contract  shall  be  binding  upon  the 
company  unless  made  in  writing,"  §  844.  Shares  are  not  transferable 
until  unpaid  calls  are  paid,  §  846.  May  borrow  money,  not  in  excess 
of  the  capital  stock,  and  give  a  mortgage  inider  the  consent  of  two- 
thirds  of  the  stock.  Shall  provide  a  sinking  fund  for  the  payment  of 
bonds  and  may  give  a  bondholder  the  right  to  convert  his  bonds  into  stock 
within  six  years,  §  849.  A  certificate  of  the  capital  being  fully  paid  is 
to  be  filed,  §850.  Consolidations  are  authorized  on  the  written  consent 
of  three-quarters  in  interest  of  the  stockholders,  §  874.  Annual  reports 
are  to  be  made  to  the  secretary  of  state,  §  878.  Must  begin  construc- 
tion within  two  years,  §  888.  False  reports  or  notices  bj'  officers  are 
misdemeanors,  §  889.  Street  railroads  may  be  incorporated  under  this 
same    act,  §]  893.     Foreign  corporations  doing  busines'j  in  the  state 


«l 


,11 


:i 


§  5^5 


NEW  HAMPSHIRE. 


06 


miist  appoint  a   resident  agent  to  accept  service  papers,  ch.  44,   L. 
1889. 

Bank8.~Five  or  more  persons  may  Incorporate  as  a  savings  bank 
"  for  their  common  benefit"  by  making,  signing,  acknowledging  and  fil- 
ing proper  certificate,  §§  948,  949.  Not  to  loan  without  property  se- 
curity except  when  so  authorized  by  by-law,  and  then  only  when  ordered 
by  three-quarters  of  all  the  directors,  §  952.  At  least  five  of  the  direc- 
tors shall  be  residents  of  state,  a  majority  to  be  citizens  of  the  United 
States,  and  all  to  be  stockholders  to  an  amount  fixed  by  the  by-laws,  §  953. 
No  liabilities  shall  be  contracted  for  any  purpose,  but  capital  and  assets 
shall  be  security  to  depositors  who  are  not  stockholders,  and  by-laws 
may  provide  that  the  same  security  shall  extend  to  deposits  made  by 
stockholders,  §  957.  Where  there  is  no  capital  stock,  five  per  cent,  of 
the  net  profits  shall  be  reserved  to  constitute  a  reserve  fund,  §  958. 
May  hold  real  property  to  secure  debts  and  suitable  lot  and  building 
for  business  not  exceeding f  100,000  in  value,  §  960.  Annual  statements 
are  to  be  published,  §  963.  Banks  under  this  act  may  have  a  capital 
stock  divided  into  shares,  in  which  case  the  rights  and  privileges  to  be 
accorded  to  such  capital  stock  are  distinct  from  those  to  be  accorded  to 
depositors,  and  the  obligations  to  be  imposed  upon  it,  shall  be  fixed  by 
the  by-laws,  §  964.     Only  paid  up  shares  shall  be  issued,  §  969. 

Taxation.— The  capital  stock  is  taxed  as  personalty,  §1081.  "  The 
owner  or  holder  of  any  stock  in  any  firm,  incorporated  company  or 
association,  the  entire  capital  of  which  is  invested  in  property  which  is 
assessed,  or  the  capital  of  which  is  assessed,  shall  not  be  assessed  in- 
dividually for  his  stock  in  such  company  or  association. "  Corporate 
property  is  taxed  in  the  county  where  it  is  located.  On  presentation  of 
receipt,  its  amount  is  deducted  from  the  amount  of  taxes  levied  where 
the  principal  place  of  business  is,  §  1086.  The  fee  of  the  secretary  of 
state  for  filing  the  certificate  of  incorporation  is  $5.00  and  40  cents  per 
folio  for  recording,  §  1798.  j 

§  25.  NEW  HAMPSHIRE.  Constitntlonal  ProTislons.— There  are 
none. 

Miscellaneous  Corporations.— Five  or  more  adults  may  incorporate 
hereunder  for  any  lawful  business,  except  banking  and  "the  construc- 
tion and  maintainance  of  a  railroad,"  by  executing  written  articles  and 
filing  them  in  the  county  and  with  the  secretary  of  state,  Gen.  L.  1878, 
p.  362.  The  amount  of  capital  stock  to  be  paid  in  must  be  stated,  Id. 
The  capital  stock  may  be  from  $1,000  to  $1,000,000.  The  corporation 
may  vary  it  within  these  limits.  Id. 

Railroad  Corporations.— May  purchase  adjoining  real  estate  to  the  ex- 
tent of  five  per  cent  of^their  capital  stock,  p.  376.    Must  have  a  treasur- 


-?^^^!i'iiPS?^|?«^«««'-'**^" 


66 

papers,  ch.  44,   L. 

as  a  savings  bank 
knowledging  and  fil- 
'ithout  property  se- 
n  only  when  ordered 
st  five  of  the  direc- 
;izens  of  the  United 
ly  the  by-laws,  §953. 
Lit  capital  and  assets 
lolders,  and  by-laws 
3  deposits  made  by 
ck,  five  per  cent,  of 
reserve  fund,  §  958. 
ible  lot  and  building 

Annual  statements 

may  have  a  capital 
and  privileges  to  be 
•se  to  be  accorded  to 

it,  shall  be  fixed  by 
isued,  §  969. 
Llty,§io8i.  "The 
porated  company  or 
in  property  which  is 
not  be  assessed  in- 
;iation."  Corporate 
On  presentation  of 

taxes  levied  where 
le  of  the  secretary  of 
00  and  40  cents  per 

roTislons. — There  are 

ults  may  incorporate 
r  and  "the  construc- 
written  articles  and 
state,  Gen.  L.  1878, 
must  be  stated,  Id. 
0.     The  corporation 

r  real  estate  to  the  ex- 
Must  have  a  treasur- 


er 


NEW  HAMPSHIRE. 


8   25 


er's  or  assistant  treasurer's  office  in  the  state  where  transfers  may  be 
filed  and  attachments  made.  Attachments  of  stock  are  to  prevail  over 
unrecorded  transfers,  Id.  Rival  and  competing  domestic  railroad  cor- 
porations shall  not  consolidate  nor  be  controlled  by  the  same  manage- 
ment, p.  377.  No  sale,  lease,  mortgage  or  contract  for  the  use  of  any 
railroad  shall  be  valid  unless  it  shall  be  in  writing  filed  in  the  office  of 
the  secretary  of  state  and  authorized  by  the  legislature,  p.  378.  No 
contract  between  two  or  more  railroads,  for  the  use  of  their  roads,  shall 
be  legal  or  binding  for  a  longer  time  than  five  years,  nor  unless  sanc- 
tioned in  writing  by  the  railroad  commissioners,  and  approved  by  the 
governor  and  council,  p.  393. 

Trustees  of  mortgage  must  call  a  meeting  of  the  creditors  secured  by 
the  mortgage,  once  a  year.  If  they  do  not,  then  one-third  in  amount  of 
the  creditors  may  call  such  meeting.  Must  make  reports  the  same  as  di- 
rectors report  to  stockholders.  Creditors  elect  the  trustees.  A  ma- 
jority of  the  trustees  must  be  residents  of  the  state,  pp.  393,  394.  By 
ch.  loo,  L.  1883,  twenty-five  or  more  may  incorporate.  The  articles 
of  incorporation  must  be  approved  by  the  court  as  to  formalities.  The 
project  must  be  laid  before  the  railroad  commissioners  a"d  they  decide 
whether  public  interests  require  the  construction  of  the  road.  An 
appeal  lies  from  their  decision  to  the  court.  Leases  and  consolidations 
are  authorized  on  a  two-thirds  vote  of  all  the  stock  voted.  If  unani- 
mous consent  is  necessary  in  any  case,  dissenting  stockholders'  stock 
may  be  appraised  and  taken  for  purposes  of  consolidation,  Id.  A  board 
of  railroad  commissioners  may  regulate  rates,  ch.  loi,  L.  1883. 

Banks.— No  creditor  of  a  savings  bank  shall  be  eligible  to  office  therein 
and  no  officer  shall  receive  a  loan  or  be  accepted  as  surety  without  the 
unanimous  consent  of  the  trustees.  Gen.  L.  1878,  p.  403. 

Trustees  shall  examine  the  bank  and  report  to  bank  commissioners 
quarterly  when  the  average  deposits  exceed  $500,000  ;  otherwise  semi- 
annually. Report  shall  be  published.  Id.  Must  set  aside  ten  per  cent 
of  net  annual  earnings  for  a  guaranty  fund  until  it  equals  five  per  cent 
of  actual  deposits,  Id.  p.  405.  No  savings  bank  shall  invest  any  part  of 
its  deposits  in  the  stock  of  any  railroad  or  manufacturing  corporation, 
Id. 

Guaranty  fund  may  be  used  when  a  majority  of  the  trustees  deem  it 
necessary,  except  for  payment  of  dividends,  L.  1885,  p.  267. 

A  record  of  all  loans  and  investments  shall  be  kept  in  a  separate 
book  for  the  inspection  of  trustees  and  bank  commissioners,  L.  1887, 

P-  450- 

General  Provisions.— One  director  must  be  an  inhabitant  of  the  state 
in  corporations  having  stockholders  resident  in  the  state,  §  351.     By 


r 


25 


NEW  HAMPSHIRE. 


68 


laws  may    rejjulate  the  tenure  of  office,   §352.     Corporations  shall  not 
become    sureties    or   guarantors,    Id.      May    hold    peisonil  and    re:J 
estate  "  not  exceedmg  the  amount  authorized  by  their  charter  or  by 
statute  and  no  ^^ther,"  Id.     Corporate    clerk    must  be    an  inliabitant 
of  the  state  and  keep  his  office  in  the  state,  Id.     Corporate  records, 
etc.,  ar  •   o  be  '"  n  t  •  the  inspection  of  stockholders  and  corporate 
ci  litv'r! ,  M'ho> .  c.ain-     are  dut   and   unpaid,  Id.     Business  shall  be 
managed  i\/  *!i;    'fTicers  subject  "to   the  votes  of    the  corporation," 
p.  35^^      T'it'.  owif!;?  of  ojie-twentieth  of  the  stock  may  have  a  meeting 
called  by  a  justice  ■■•    he   peace,  Id.  p.    353.     Directors   are   to    be 
three  or   more,  p.  354.     The    capital  stock  may  be  increased  or  ili- 
minished    by    the  corporation  within    the    charter   limits.    Id.     Stock 
shall    not  be  disposed  of  at  less  than  its  par  value.  Id.  p.  355.     No 
certificate  of  stock  shall   be   issued    unless    'is    full    value   has   been 
paid  in  or  the    certificate    states   the   amount    pr.id    in    upon    it,    Id. 
A  delivery  of  stock  with  a  written  transfer  is  good  against  all  parties, 
but  not  to  affect  the  right  of  the    corporation  to  treat  the  holder  of 
record  as  the  holder   in    fact,    ch.    16,    L.    1887.     Except    in   banks 
whose  charters  contain  other  provisions  ea<;h  share  is  entftled  to  on^^ 
vote,  but  no  stockholder  shall  vote  more  than  one-eighth  of  the  capital 
stock,  G.  Stat.  p.  356.  A  stockholder  who  is  challenged  must  swear  that  he 
is  a.  6ana^tie  owntr,  Id.     One  stockholder  shall  not  vote  as  the  proxy 
of  another.     No  proxy  can  represent  more  than  one  stockholder.     No 
one  can  vote  as  proxy  more  than  one-eighth  of  the  capital  stock.  Other- 
wise as  to  railroads,  Id.     Proxies  a.re   good  only   for  the  one  meeting  " 
named  therem.  Id.    Railroad  proxies  are  allowed  only  in  case  of  women 
and    sick,    infirm  or  old  stockholders.      No  proxies  allowed  for  over 
$5,000,  including  the  stock  owned  by  the  proxy  himself.     Stockholders 
cannot  distribute  proxies,  Id.     The  officers  in  all  corporations,  except 
banks,  are  liable  for  corporate  loans  to  stockholders,  and  for  corporate 
debts  in  excess  of  one-half  of  the  paid-in  capital  stock  and  other  assets 
excepting  in  the  latter  case,  insurance  companies,  p.  357.     No  loan 
shall  be  made  by  any  corporation  except  banks  to  any  stockholder,  Id. 
Stockholder  receiving  an  unlawful  loan,  or  unlawful  dividend  is  liable 
for  all  corporate  debts,  until  the  same  is  repaid.  Stockholders  in  all  cor- 
porations, except  banks  and  railroads,  are  liable  for  all  corporate  debts 
until  the  capital  stock  is  paid  m  and  a  certificate  to  that  effect  filed.    In 
railroads  they  are  liable  "  to  the  amount  of  the  par  value  of  their  stock." 
Directors  are  liable  for  all  corporate  debts,  if  they  do  not  file  an  annual 
report,  except  in  railroads  and  banks,  Id.  p.  358.     Directors  are  liable 
for  corporate  debts,  if  they  fail  to  file  a  certificate  that  the  capital  stock, 
is  paid  in,  if  it  has  been  paid  in,  except  in  banks,  Id.  p.   359,     The  in- 


il 


U 


■  iii 


^m"!^PW?5^^^-^§^^^^^iSS^^ 


V    J 


".!JH 


68 

jrporations  shall  not 

peisonil  and  reiJ 
their  charter  or  by 
it  be    an  inhabitant 

Corporate  records, 
Iders  and  corporate 

Business  shall  be 
f  the  corporation," 
may  have  a  meeting 
lirectors  are  to  be 
be  increased  or  di- 

limits,  Id.  Stock 
le.  Id.  p.  355.  No 
nil  value  has  been 
.id  in  upon  it.  Id. 
d  against  all  parties, 

treat  the  holder  of 
Except  in  bank* 
re  is  entftled  to  onv^ 
-eighth  of  the  capital 
id  must  swear  that  he 
)t  vote  as  the  proxy 
ne  stockholder.  No 
;apital  stock.  Other- 
br  the  one  meeting ' 
ily  in  case  of  women 
es  allowed  for  over 
mself.  Stockholder* 
corporations,  except 
s,  and  for  corporate 
ock  and  other  assets 
s,  P-  357-  No  loan 
any  stockholder,  Id. 
ul  dividend  is  liable 
ockholders  in  all  cor- 
ir  all  corporate  debts 
)  that  effect  filed.  In 
/alue  of  their  stock." 
do  not  file  an  annual 
Directors  are  liable 
that  the  capital  stock 
[d.  p.   359-     The  in- 


69 


NEW  JKRSRV. 


8   26 


dividual  liab.iity  of  stockholders  can  be  enforced  only  by  a  suit  in 
equity.  ).  360.  As  to  cumulative  ^  iting,  see  ch.  54,  Laws  1879.  Ch. 
■02,  L.  1887,  makes  it  a  misdemeanor  to  misuse  railroad  ])roperty  or 
finid'j  to  influence  legisiatii  n.  Savings  banks  are  to  keep  a  separate 
book  contain''  ;  a  record  of  loans  and  investments,  ch.  65,  L.  1887. 

Tuxalion.— The  tax  on  the  incorporation  of  miscellaneous  corpora- 
tions is  $50.00  and  $25.00  for  amendments;  $1.00  on  every  $1,000  of 
capital  of  banks,  and  50  cents  a  $1,000  on  railroads,  69.  Railroad 
realty  not  used  for  the  ordinary  and  usual  purposes  of  railroading  is 
taxed  the  same  as  that  of  individuals,  p.  139.  Shares  of  stock  in  all 
corporations,  except  railroad  and  manufacturing,  are  tixed.  Id.  Mso 
stock  in  foreign  corporations,  unless  such  stock  is  taxed  where  tl.  cor  ■ 
poration  is  located.  Surplus  bank  capital  is  taxed.  Id.  No  str  -k  is  > 
be  subject  to  double  taxation,  p.  140.  Stock  in  domestic  cor' c :  ''icni. 
owned  by  non-residents,  except  in  railroad  'ind  manufacturi":  -oi,, sa- 
nies, is  taxed  at  the  principal  place  of  business  of  the  corporation,  ,  41 . 
The  taxable  property  of  the  corporation  shall  be  taxed  at  its  "hief  plaoe 
of  business.  Id.  I'or  false  returns  the  tax  is  increased  i  fo'  I,  p. 
145.  Corporate  officers  are  obliged  to  state  the  residence,  tiamos  and 
amount  of  stock  of  stockholders,  p.  146.  Transfers  to  avoid  taxation 
are  punished  by  a  fine,  p.  147.  Any  jjortion  of  a  railroad  which  has 
not  been  complced  ten  years  is  exempt  from  taxation,  p.  160,  amended, 
ch.  75,  L.  1881.  The  state  collects  a  tax  on  th*;  actual  value  of  railroad 
property.  One-fourth  is  distributed  among  the  to.vns  through  which  it 
runs.  The  residue  among  the  towns  in  which  the  railroad  stock  is  held 
or  owned.  The  proportion  on  non-residents'  stock  go<  s  to  the  state.  Id. 
160.  Bank  stock  is  taxed  in  towns  where  it  is  owned  and  non-residents' 
stock  at  the  principal  place  of  business,  p.  169,  etc.  Towns  may  ex- 
empt from  taxation  for  ten  years,  manufacturing  companies,  both  as  to 
their  capital  and  tangible  property,  p.  140.  But  not  where  such  corpo- 
ration was  previously  exempted  by  any  other  town,  ch.  21,  L.  1887. 
Fire  insurance  companies  pay  in  lieu  of  all  other  taxes,  one  per  cent 
on  their  paid-up  capital,  ch.  57,  L.  1887. 

§  26.  NEW  JERSEY.  Constitalional  ProTisions.— Municipalities  are 
forbidden  to  loan,  aid,  or  buy  stocks  or  bonds  of  corporations.  Amend- 
ments Art.  I.,  55  19.  State  and  municipalities  are  forbidden  to  donate 
land  or  money  to  corporations,  Id.  §  20.  No  private,  special  or  local 
bill  shall  grant  to  a  corporation  any  exclusive  immunity  or  franchise 
whatever,  or  right  to  lay  down  railroad  tracks.  Special  corporate 
charters  are  prohibited,  but  general  laws  shall  be  passed  for  granting 
corporate  powers,  subject  to  repeal  or  alteration,  Art.  IV.,  §  7. 


26 


NEW  JKR8RY. 


70 


MlMccllaneoiiH  Corporationn. — Three  or  more  may  incorporate  "  for 
any  lawful  business  or  purpose  whatever,"  under  the  Act  of  April  "j.. 
1875,  except  railroads,  turnpikes,  or  companies  requiring  i.se  of 
power  of  eminent  domain,  banks  and  insurance,  Revision  of  N.  J. 
Laws,  p.  179,  g  10,  L.  1888,  ch.  80.  Capital  stock  is  to  be  $2,000  or 
over,  and  $1,000  paid  in.  The  certificate  of  incorporation  may  limit 
the  powers  of  the  corporation,  directors  or  stockholders.  Part  of  the 
l)usiness  may  be  done  out  of  the  state.  Certificate  must  so  state. 
Directors  must  be  stockholders,  and  are  to  manage  the  business,  p. 
180.1  Hy-laws  may  determine  how  many  votes  the  shares  of  stock 
may  cast.  Preferred  stock  may  be  issued  on  a  two-thirds  vote  of 
the  stock.  Transfers  as  collateral  security  shall  state  that  fact  on 
the  transfer  book,  p.  181.  By  a  two-thirds  vote  in  interest,  the 
nature  of  the  business  may  be  changed,  p.  182.  The  transfer  book 
is  to  be  open  to  inspection  for  thirty  days  before  elections,  p.  183. 
No  proxies  are  to  be  older  t'  .  three  years,  and  no  stock  is  to  be 
voted  if  transferred  less  th  twenty  days  prior  to  the  election.  The 
supreme  court  may  prr  jed  summarily  to  review  the  fairness  and 
legality  of  elections,  p.  ib^.  A  list  of  namesof  directors  and  officers  is  to 
be  published  and  fileil  annually  with  the  secretary  of  state,  within  thirty 
days  after  an  election,  p.  185,  amended  L.  1877,  p.  103,  Suppm't  to  Rev., 
p.  169.  Stockholders'  meetings  are  to  be  in  the  state;  directors  may  meet 
outside  if  the  by-laws  permit;  an  office,  with  transfer  books  is  to  be  kept 
in  the  state;  court  may  order  all  books  into  the  state;  loans  to  stock- 
holders or  directors  are  prohibited;  three  o:  more  stockholders  may 
call  a  meeting,  p.  186.  Stock  may  be  issued  for  property:  must  be  so 
stamped  on  the  certificates;  officers  are  liable  for  all  debts  for  issuing 
certificates  or  public  notice  containing  false  statements,  p.  187. 
Corporate  creditors'  remedy  against  stockholders  may  be  at  law  or  in 
equity,  p.  194.  Notice  is  to  be  given  of  application  for  acts  of  incor- 
poration. Id.  Preferred  stock  may  be  issued  in  payment  of  property, 
Act  March  31,  1882.  Such  stock  (issued  for  property)  may  contain  a 
provision  guaranteeing  a  dividend,  Act  March  31  1882,  Suppm't  to  Rev., 
p.  149.  Manufacturing  corporations,  incorporated  under  Act  of  April 
7,  1875,  must  have  one  director  resident  in  New  Jersey*  and  must  file 
his  name  and  residence  with  the  secretary  of  state,  Act  March  16,  1881, 
Suppm't  to  Rev.,  p.  162.  Co-operativemanufacturing  corporations  may 
be  formed  by  seven  or  more  with  a  capital  of  $1,000  to  $50,000,  Act 
March  12,  1880,  Suppm't  to  Rev.,  p.  162. 

If  business  is  to  be  carried  on  out  of  the  state,  the  articles  of  associa- 

'  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxvii. 

Vrf. 


Ttt 


10 

incorporate  "  for 
[le  Act  of  April  7 
requiring    ise    of 
Revision  of   N.  J. 
:  is  to  he  $2,000  or 
poration   may  limit 
ders.      Part  of  the 
ite  must   so  state. 
e  the  business,  p. 
he  shares  of  stock 
two-thirds  vote  of 
state  that   fact  on 
te    in    interest,  the 
The  transfer  book 
elections,    p.  183. 
no  stock  is  to   be 
the  election.     The 
V  the  fairness    and 
ors  and  officefs  is  to 
f  state,  within  thirty 
o3,Suppm'ttoRev., 
;  directors  may  meet 
•  books  is  to  be  kept 
le;    loans  to  stock- 
e  stockholders  may 
operty:  must  be  so 
,11  debts  for  issuing 
statements,   p.    187. 
nay  be  at   law  or  in 
n  for  acts  of  incor- 
lyment  of  property, 
erty)  may  contain  a 
82,  Suppm't  to  Rev., 
1  under  Act  of  April 
ersey*  and  must  file 
Act  March  16,  1881, 
ing  corporations  may 
,000  to  $50,000,  Act 

he  articles  of  associa- 
ion  Law,  chapter  xxxvii. 


71 


NEW  JERSEY. 


B   26 


tion  must  state  where  the  principal  office  out  of  the   state  is  to  be   lo- 
cated, L.  1889,  ch.  265. 

Directors  may,  by  the  articles  of  association,  be  elected  for  a  longer 
term  than  one  year,  up  to  five  years,  and  these  terms  may  run  out  in 
different  years;  and  if  there  are  various  kinds  of  stock,  a  separate  kind 
may  be  authorized  by  the  articles  or  by-laws  to  choose  one  or  more  of 
the  directors,  Id,  As  to  preferred  stock,  dividend  to  be  yearly,  not  over 
eight  per  cent. 

Certain  corporations  may  purchase  the  stock  of  other  similar  com- 
panies and  issue  stock  therefor,  I..  1889,  ch.  265. 

(aiaranteed  stock  may  be  converted  into  preferred  stock,  ch.  267, 
L.  1889. 

The  capital  stock  of  any  corporation,  excepting  railroad  and  canal 
comiianii's,  may  be  increased  to  any  amount,  upon  the  assent  of  two- 
thirds  in  interest  of  the  stock  and  upon  complying  with  certain  for- 
malities, ch.  105,  L.  1889. 

Railroads.— The  consolidation  or  merger  of  connecting  lines  is 
authorized.  Act  of  April  17,  1885.  Consolidation  with  or  lease  to  a 
foreign  corporation  is  forbidden  unless  the  express  consent  of  the  legisla- 
ture thereto  is  first  obtained,  Act  of  May  2,  1885.  The  consolidation  of 
connecting  railways  is  authorized  upon  a  two-thirds  vote  of  the  stock  in 
each  company.  Dissenting  stockholders  must  be  bought  out.  Act 
March  25,  1881.  Railroad  directors  must  be  full  stockholders.'  At 
elections  a  majority  of  the  stockholders  present  may  demand  an  in- 
spection of  the  corporate  books  and  papers,  Act  March  25,  t88r. 
Directors  of  foreign  corporations,  authorized  by  the  state  to  do  business 
therein,  may  meet  in  New  Jersey,  and  may  have  a  transfer  office  there. 
Revision  of  N.  J.  Laws,  p.  919.  Stockholders  may  grant  to  bondholdera 
the  right  to  vote.  Bondholders  then  become  liable  for  corporate  debt* 
the  same  as  stockholders.  Act  of  April  21,  1876.  A  majority  of  the 
directors  must  be  residents,*  Revision,  p.  925.  Must  all  be  stock- 
holders. Id.  p.  926.*  Stock  is  not  transferable  until  previous  calls  have 
been  paid.  Id.  p.  926.  A  corporation  may.  be  formed  to  own  a  railroad 
purchased  at  a  foreclosure  sale,  Acts  April  5,  1875  and  March  25,  1875. 
No  franchise  is  to  be  exclusive,  Rev.  p.  935.  Thirteen  may  incorpo- 
rate. Id.  p.  925.  Railroad  companies  may  acquire  real  estate  at  each, 
terminal  point  and  intermediate  depot,  as  the  exigencies  of  business 
demand,  up  to  ten  acres  at  each  such  point,  L.  1887,  ch.  81,  p.  113. 
Railroad  companies  may  purchase  or  rent  wharves,  boats,  etc., 
"  capable  of  being  of  use  in  the  transportation  of  freight  or  passen- 
'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxvii. 
Vrf.  '/rf. 


Id 


NKW   JKKHRY. 


Rfis,"  L.  1888,  .ch.  140.  The  governor,  chancellor,  vice-chancellor, 
suprtMue  court  justices,  judges  of  the  court  of  errors,  secretary  of  state, 
statf  treasurer,  comptroller  of  the  treasury,  clerk  in  chancery,  supreme 
<'(iurt  clerk,  ailjutant  general,  (piartermaster  general,  slate  librarian, 
state  prison  keeper,  superintendent  of  jjublic  schools  anil  members  and 
ofticers  of  both  houses  of  the  legislature  "  shall  pass  and  re|)ass  free  of 
charge"  on  railroads  incorporated  under  the  general  act.  Rev.  p.  9.^5. 

Itiiiiks. — May  be  organizid  'ry  seven  citizens  of  the  state,  with  a 
capital  varying  from  #50,000  to  $2,000,000.  There  seems  to  be  no 
liability  of  stockholders  beyond  that  for  their  unpaid  supscriptions. 
Revision,  pp.  57,  etc.  A  governing  board  of  savings  banks  in  certain 
cities  is  to  proviile  for  the  election  of  a  depositors'  committee  of  three 
to  appoint  annually  a  board  of  four  inspectors,  I,.  1888,  ch.  280, 
p.  418.  Hanks  shall  make  annual  reiiorts  to  the  state  and  are  subject 
to  the  inspection  and  control  of  the  state  Inink  commissioners,  L.  1889, 
ch.  229. 

(JoiHiriil  rrovlslons. — When  the  stock  is  not  all  paid  in,  stockholders 
are  all  liable  ratably  for  the  unpaid  part.  Revision  of  1877,  p.  178. > 
Directors  may  increase  the  capital  slock  in  order  to  pay  overdue 
bonds.  Act  of  March  2,  1882,  Sup't  to  Rev.  p.  153.  Foreign  corpora- 
tions may  h(jld,  mortgage,  lease  and  convey  real  estate  in  New  Jersey 
for  corporate  purposes,  Act  March  17,  1882.  Domestic  and  foreign 
corporations  may  own  and  dispose  of  stocks  and  bonds  of  other  domes- 
tic corporations,  L.  1888,  ch,  269,  p.  385.  Certain  corporations,  such 
as  land,  hotel  and  transportation  companies,  may  issue  their  own  stock 
to  purchase  stock  in  other  companies,  provided  they  all  have  an  office 
in  or  do  business  in  the  same  county,  and  provided  such  transporta- 
tion business  be  incidental  or  necessary  o  the  other  business  named, 
L.  1888,  ch.  295,  p.  445.  Corporations  may  consolidate  and  merge 
upon  the  basis  of  an  agreement  by  the  board  of  directors  assented  to  by 
a  majority  stock  vote  at  a  meeting  specially  called,  the  agreement 
being  filed  with  the  secretary  of  state.  Objecting  stockholders  are  to  be 
paid  the  appraised  value  of  their  stock,  the  objection  to  be  made  at 
the  meeting  or  within  twenty  days,  and  written  notice  to  be  served  upon 
the  new  officers  within  ten  days  after  their  election,  L.  1888,  ch.  294, 
pp.  441-445.  Ch.  48,  L.  1888,  provides  for  the  consolidation  of  street 
railway  companies.  The  number  of  directors  may  be  decreased  by  the 
written  assent  of  two-thirds  in  value  of  the  stockholders  filed  with  the 
secretary  of  state,  L.  1888,  ch.  22.  Foreign  corporations  may  acquire, 
hold,  mortgage, 'lease  and  convey  such  real  estate  as  may  be  necessary 
for  the  purpose  of  their  business  and  to  secure  debts.  Corporations 
'  Cook  on  Stock  and  Stockholders  and  General  Corporation    Law,  chapter  xii. 


7S 

:>T,  vice-chancellor, 
,  secretary  of  state, 
chaiK  ery,  siiprt'iiie 
al,  slate  librarian, 
I  and  nu'nibers  and 
anil  repass  free  of 
act.  Rev.  p.  9.15. 
the  state,  with  a 
re  seems  to  be  no 
paid  snpscriptions, 
s  banks  in  reitain 
conunittee  of  three 
],.  1888,  ch.  a8o, 
e  and  arc  subject 
nissioners,  1,.  1889, 

lid  in,  stockholders 
1  of  1877,  p.  178.' 
r  to  pay  overdue 
Foreijjn  corpora- 
tate  in  New  Jersey 
nestic  and  foreign 
ids  of  other  domes- 
corporations,  such 
ue  their  own  stock 
all  have  an  office 
d  such  transporta- 
ir  business  named, 
;olidate  and  merjje 
ctors  assented  to  by 
ed,  the  agreement 
ckholders  are  to  be 
on  to  be  made  at 
e  to  be  served  upon 
,  L.  1888,  ch.  294, 
solidation  of  street 
)e  decreased  by  the 
Iders  filed  with  the 
itions  may  acquire, 
s  may  be  necessary 
ebts.  Corporations 
on    Law,  chapter  xii. 


8T 


NKW  JKKHRY. 


»  2rt 


chartered  to  do  a  real  estate  business  are  authorized  to  conduct  it  in 
this  state,  I,.  1887,  ch.  134,  p.  157,  amending  ^  99,  Act  April  7,  1875. 
A  lien  of  workmen  exists  upon  the  assets  of  an  insolvent  corporation, 
1,.  1887,  ill.  71,  p.  99, 

Taxiitlon.i — 'i'he  real  and  personal  property  of  manufacturing  cor- 
poratious  is  taxed  the  same  as  that  of  an  individual.  Act  May  11,  1886, 
Suppm't  to  Rev.  1886,  p.  161. 

lly  the  important  Act  of  April  18,  1884,  Suppm'tto  Rev.  1886,  p.  loi^i* 
an  annual  tax,  as  a  license  for  the  corporate  franchise,  must  be  paid  to 
the  state,  as  follows:  'I'elegraph,  telephone,  i:al)le  and  express  compa- 
nies not  owned  by  railroad  companies  and  not  otherwise  taxed,  pay  two 
per  cent  of  gross  receipts;  gas  and  electric  light  companies  pay  one- 
half  of  one  per  cent  of  gross  receipts,  and  five  per  cent  of  dividends  in 
excess  of  four  per  cent;  oil  and  pipe  line  comi)anies  pay  four-fifths  of 
one  per  cent  of  gross  receipts;  parlor,  palace  and  sleeping  car  compa- 
nies two  per  cent  of  gross  receipts;  life  insurance  companies  one  per 
cent  of  surplus;  insurance  companies  other  than  life,  one  per  cent  of  gross 
premiinns;  foreign  insurance  companies  two  per  cent  of  net  premiums 
collecteil  in  state;  all  other  corporations,  except  banks,  canal,  railways, 
cemeteries,  religious,  charitable,  educational  and  manufacturing  or  min- 
ing corporations  carrying  on  business  in  the  state  shall  pay  a  yearly  license 
fee  or  tax  of  one-tenth  of  one  per  cent  of  their  cai)ital  stock.  If  the  tax 
is  not  paid  in  three  months  the  attorney-general  may  cause  the  corpor- 
ation to  be  restrained  from  doing  business.  lly  the  Act  of  April  10, 
1884,  Suppm't  to  Rev.  1886,  p.  1003,  amended  L.  1888,  ch.  208,  259, 
railways  and  canals  are  taxed  as  follows:  All  personalty  and  realty  not 
used  for  railway  or  canal  purposes  is  taxed  the  same  as  are  individuals. 
A  state  board  of  assessors  assesses  the  total  value  of  the  road,  build- 
ings, etc.,  in  the  s'ate;  a  tax  of  one-half  of  one  per  cent  is  to  be  paid 
to  state;  the  tax  ui  the  municipalities,  which  shall  not  exceed  one  per 
crnt,  is  apportioned  and  levied  by  the  state  assessors;  is  paid  to  the 
state,  and  repaid  by  the  state  to  the  municipality.  Stock  and  bonds  are 
then  exemf  from  taxation.  Ky  Act  of  March  5,  1883,  corporations 
organizing  nder  the  Act  of  April  7,  1875  (including  manufacturing 
corporations),  must  pay  $25  for  their  charter  if  the  capital  stock  is 
$100,000  or  less;  must  pay  one-fifth  of  one-tenth  of  one  per  cent  if  over 
$100,000,  Suppu.'t  to  Rev.  1886,  p.  149.  Manufacturing  corporations 
and  all  other  corporations  organized  under  Act  of  April  7,  1875,  shall 
be  taxed  on  their  capital  stock  at  its  actual  value,  and  on  their  surplus. 
Act  March  14,  1879,  Suppm't  to  Rev.,  p.  161,  cf.  Revision,  p.  1156.  ill 
real  and  personal  property  of  corporations  is  taxed  the  same  as  tha.  if 
'Cook  on  Stock  and  Stockholders,  and  General  Corporation  Law,  chapter   vKxiv. 


I      • 


Ill 


i 


§  2*^ 


NEW  YORK. 


74 


an  individual,  except  railway,  turnpii<e,  insurance,  canals,  banks,  cemeter- 
ies and  charitable,  religious  or  educational,  Act  March  7,  1878,  Suppm't 
to  Rev.  1886,  p.  170.  Shares  of  stock  in  domestic  or  foreign  corpora- 
tions are  taxed.  Revision,  p.  1151.  The  personalty  of  corporations  is. 
taxed  where  the  principal  place  of  business  is.  Id.  p.  1152.  Real  estate 
is  taxed  where  it  lies,  Id.  Foreign  corporations  doing  business  in  the 
state  are  also  taxed.  Id.  p.  1157.  The  value  of  the  real  estate  is  de- 
ducted from  the  assessed  value  of  the  capital  stock.  Id,  p.  1159.  Bank 
stock  is  assessed  against  residents  wherever  they  reside,  but  against  the 
bank,  in  cases  of  non-resident  stockholders,  Id.  p.  1161,  Railroad 
and  Canal  Taxation  Act,  L.  1888,  ch.  208,  pp.  269-287,  ch.  259.  p. 
376.  Savings  banks  pay,  in  lieu  of  all  other  taxes,  an  annual  tax  of 
one-half  of  one  per  cent  upon  deposits  after  deducting  available  funds,, 
exempted  securities  and  the  cost  of  real  estate  purchased  and  foreclos- 
ure (which  real  estate  is  subject  to  ordinary  tax),  L.  1888,  ch.  436,  p.. 
545- 

§  27.      NEW    YORK.     Constitutional  Provisions The   legislature 

shall  not  pass  a  private  or  local  bill  granting  "to  any  corporation,  asso- 
ciation or  individual  the  right  to  lay  down  railroad  tracks,"  nor  grant- 
ing "  to  any  private  corporation,  association  or  individual  any  exclu- 
sive privileges,  immunity  or  franchise  whatever No  law  shall 

authorize  the  construction  or  operation  of  a  street  railroad  except  upon 
the  condition  that  the  consent  of  the  owners  of  one-half  in  value  of  the 
property  bounded  on,  and  the  consent  also  of  the  local  authorities  hav- 
ing the  control  of  that  portion  of  a  street  or  highway  upon  which  it  is 
proposed  to  construct  or  operate  such  railroad  be  first  obtained  ;  or  in 
case  the  consent  of  such  property  owners  cannob  be  obtained,  the  gen- 
eral term  of  the  supreme  court  in  the  district  in  which  it  is  proposed  ta 
be  constructed,  may,  upon  application  appoini  three  commissioners- 
who  shall  determine,  after  a  hearing  of  all  parties  interested,  whether 
such  railroad  ought  to  be  constructed  or  operated,  and  their  determin- 
ation, confirmed  by  the  court,  may  be  taken  in  lieu  of  the  consent  of 
the  property  owners,"  Art.  III.,  §  18.  The  state  shall  not  give  or  loan 
its  aid  or  credit  to  any  corporattirU,  Art.  VII.,  §  6,  and  Art.  VIII.,  §  10. 
Corporations  shall  not  be  created  by  special  act,  unless  in  the  opinion 
of  the  legislature  the  objeclj  of  the  corporation  cannot  be  obtained  by- 
general  'aws.  General  or  special  incorporating  acts  may  be  altered  or 
repealed,  Art.  VIII.,  ^  :,  Savings  banks  shall  not  have  a  capital  stock 
and  their  director?  shall  not  ha  ^e  any  interest  in  their  profits  nor  be  in- 
terestea  .">  the*,  loan;,  Id.  §  4.  i'tockholders  in  state  banks  which  issue 
money  are  liable  to  creditors  to  the  extent  of  the  par  value  of  their 


[ 


■SESBBS!'**'V 


74 

lis,  banks,  cemeter- 
h  7,  1878,  Suppm't 
ir  foreign  corpora- 
of  corporations  is. 
1 15  2.  Real  estate 
ig  business  in  the 
2  real  estate  is  de- 
Id.  p.  1 159.  Bank 
de,  but  against  the 
p.  1 161,  Railroad 
59-287,  ch.  259.  p. 
s,  an  annual  tax  of 
ig  available  funds,, 
ased  and  foreclos- 
L.  1888,  ch.  436,  p. 


I The   legislature 

f  corporation,  asso- 
tracks,"  nor  grant- 
lividual  any  exclu- 
.     .     No  law  shall 
ilroad  except  upon 
•half  in  value  of  the 
:al  authorities  hav- 
,y  upon  which  it  is 
rst  obtained  ;  or  in 
obtained,  the  gen- 
;h  it  is  proposed  to- 
iree  commissioners, 
interested,  whether 
ind  their  determin- 
of  the   consent  of 
lall  not  give  or  loan 
ind  Art.  VIII.,  §  10. 
nless  in  the  opinion 
lot  be  obtained  by 
i  may  be  altered  or 
have  a  capital  stock 
ir  profits  nor  be  in- 
e  banks  which  issue 
he  par  value  of  their 


76 


NEW  YORK, 


§  27- 


stock  in  addition  to  the  subscription  liability,  Id.  §  7.  "No  county, 
city,  town  or  village  shall  hereafter  give  any  money  or  property,  or 
loan  its  money  or  credit  to  or  in  aid  of  any  individual,  association  or 
corporation,  or  become  directly  or  indirectly  the  owner  of  stock  in  or 
bonds  of  any  association  or  corporation,  nor  shall  any  such  county, 
city,  town  or  village  be  allowed  co  incur  any  indebtedness,  except  for 
county,  city,  town  or  village  purposes,"  Id.  §  11. 

Miscellaneous  Corporations. — Three  or  more  may  incorporate  for 
various  manufacturing  purposes,  ch.  40,  L.  1848,  and  many  amend- 
ments. See  R.  S.,  8th.  ed.,  p„  1953.1  The  capital  stock  is  not  limited. 
Corporation  may  exist  for  fifty  years,  Id.  Directors  may  be  from  tl.ree 
to  thirteen.  Id.  p.  1956.  They  must  be  stockholders  and  citizens  of 
the  United  States  and  a  majority  must  be  citizens  of  the  state.  Id.  §  3.' 
Directors  elect  a  president  from  their  number.  Id.  §  5.  Directors  make 
the  by-laws,  Id.  Shares  are  not  tran,3ferable  until  past  due  calls  are 
paid.  The  company  shall  not  purchase  stock  in  any  other  company. 
Id.  §  8.8  Except  the  slrck  of  corporations  producing  or  consuming 
articles  of  the  first  corporation,  p.  1967 .  Until  the  capital  stock  is  paid 
up  and  a  certificate  to  that  effect  filed,  the  stockholders  are  liable  doubly 
on  their  stock.  The  capital  stock  must  be  paid  in  :  one-half  within 
a  year,  the  remainder  within  two  years,  p.  1957,  §  10.  Directors  must 
file  a  specified  annual  report,  and  for  failure  so  to  do  are  liable  for  all 
debts.  Id.  §  12.  Stock  may  be  issued  for  property,  p.  1961.*  For 
making  reports  willfully  false,  the  directors  are  liable  for  all  debts,, 
p.  1958,  §  15.*  Executors,  administrators,  guardians,  trustees  and 
pledgees,  are  not  liable  on  stock,  Id.  §  16.  But  may  vote,  except  in 
the  case  of  pledgee.  Id.  §  17.  Stockholders  are  liable  for  debts  to- 
laborers.  Id.  §  i8.«  The  stockholders'  statutory  liability  does  not  apply 
to  debts  payable  more  than  a  year  after  the  debt  is  contracted.  It 
lapses  unless  suit  is  brought  within  a  year  after  the  debt  becomes  due. 
A  transfer  of  stock  releases  the  transferrer  after  two  years,  p.  i960,  §  24. 
Stock  books  shall  be  open  to  stoc"  olders  and  creditors.  Id.  §  25.'' 
Stockholder  owning  a  certain  amount  of  stock  may  demand  a  statement 
of  assets  and  liabilities.  Id.  §  27.  Consolidations  are  provided  for,  p.  1968. 
Mortgages  may  be  made  upon  the  written  consent  cf  two-thirds  of  the 
stockholders,  pp.  1965.  1973.^  A  valuable  little  boo!:  giving  the  deci- 
sions under  this  act  has  been  written  by  Mr.  W.  S.  Poor  (L.  K.  Strouse 
&  Co.,  1886.)  ':^ 

'  Cook  c.  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xiii, 

'/rf.,  riiapter  xxxvii.                        '/aT. ,  chapter  xix.  */</.,  chapter  ii. 

'Id  ,  chapter  xii.                             'Id.,  chapter  xii.  '/</,,  chapter  xxjfc 
'  d.,  chapter  xii. 


If 


§  '27 


NEW  YORK. 


76 


!h  I  ". 


!'  i 


m-ff 


The  above  act  does  not  authorize  incorporation  for  all  purposes. 
Accordingly  in  1875  another  act  was  passed  called  "The  Business  Men's 
Act."  Under  it,  incorporation  is  authorized  for  any  lawful  purpose,  ex- 
cept banking,  insurance,  construction  or  operation  of  railroad  or  aiding 
in  the  construction  thereof,  savings  banks  and  trust,  etc.,  companies,  p. 
1978,  Fictitious  and  watered  stock  is  void,  p.  1982,  §  14.^  Books  and 
accounts  are  open  to  stockholders'  inspection.  Id.  §  16.*  Directors 
must  file  reports,  p.  1983,  §  18,  No  loans  to  be  made  to  stockholders, 
Id.  §  20.^  Most  of  the  provisions  of  the  manufacturing  companies'  act 
of  1848  are  re-enacted  herein.  But  corporations  formed  undar  this  act 
may  be  with  full  liability  of  stockholders  for  all  debts,  or  only  limited 
liability,  p.  1986,  Companies  with  limited  liability  must  place  the 
word  "  limited  "  after  their  name,  Id.  Bonds  and  mortgages,  not  over 
half  of  value  of  corporate  property,  may  be  issued  on  vote  of  more  than 
two-thirds  of  stock,  p.  1982.''  In  addition  to  the  above  acts  there  are 
"many  other  general  laws  for  incorporations.  Thus,  for  building  asso- 
ciations, see  p.  1991.  Ho'?ls,  p.  2001.  Parks,  etc.,  p  2004.  Agricul- 
tural purposes,  p.  2015.  Co-operative  companies,  p.  2045.  Turnpikes, 
p.  1462.  Bridge,  p.  1509.  Insurance,  p.  1608.  Water  works,  p.  2047. 
Exchanges  and  boards  of  trade,  p.  2057.  Pipe  lines,  p.  1862. 
Telegraph,  p.  2060.  Building,  p.  1971.  Joint  stock  associations,  p. 
2088.  Associations  must  file  a  certificate  stating  the  law  under  which 
they  are  organized,  under  penalty  of  $50  a  day,  ch.  505,  L.  1885. 

Railroads.— The  great  railroad  act  of  New  York  enacted  in  1850, 
L.  1850,  ch  140,  has  been  substantially  re-enacted  in  every  state  of  the 
Union.  Among  its  requisites  are  that  there  must  be  at  least  twenty-five 
persons  for  incorporation;  the  capital  stock  is  to  be  at  least  $10,000  a 
mile,  and  directors  are  to  be  thirteen,  pp.  1738,  1739.  No  incorporation 
is  allowed  until  $1,000  per  mile  is  subscribed  and  ten  per  cent  paid 
in,  Id.  Stock  must  have  been  owned  thirty  days  previous  to  elections, 
in  order  to  be  voted.  Directors  must  be  stockholders  qualified  to  vote. ^ 
The  books  and  papers  of  the  company  are  to  be  present  at  elections,  if  a 
majority  of  the  stockholders  so  require.  Purchasers  of  a  railroad  at  a  fore- 
closure sale  may  incorporate  hereunder,  p.  1739.  The  directors  appoint 
the  president  and  other  officers,  p.  1740,  §6.  "  It  shall  not  be  lawful 
for  such  company  to  use  any  of  its  funds  in  the  purchase  of  any  stock 
in  its  own  or  in  any  other  corporation,"  Id.  §8.*  Stockholders  are 
liable  to  laborers  for  thirty  days  of  services,  with  certain  restrictions  on 
the  right  of  collection,  p.  i74i,§§  10,  12. ■<     Executors,  guardians,  trus- 

'  Cook  on   Stock  and  Stockholders  and  General  Corporation  Law,  chapter  iii. 
'/(/., chapter  xxx.  'Id.,  chapter  xli.  *  /</.,  chapter  xli. 

•/«/.,  chapter  xxxvii.  ,  */</.,  chapter  xix.  '/«/.,  chapter  xii. 


76 

for  all  purposes, 
e  Business  Men's 
wful  purpose,  ex- 
ailroad  or  aiding 
tc,  companies,  p. 
[  14.1  Books  and 
§  16.*  Directors 
i  to  stockholders, 
ig  companies'  act 
ed  under  this  act 
;s,  or  only  limited 

must  place  the 
)rtgages,  not  over 
I'ote  of  more  than 
'e  acts  there  are 
"or  building  asso- 
[■)  2004.  Agricul- 
2045.  Turnpikes, 
it  works,  p.  2047. 
)e  lines,  p.  1862. 
c  associations,  p. 
law  under  which 
.5,  L.  1885. 
:  enacted  in  1850, 
every  state  of  the 
t  least  twenty-five 
t  least  $10,000  a 

No  incorporation 
en  per  cent  paid 
'ious  to  elections, 
qualified  to  vote.' 
t  at  elections,  if  a 
I  railroad  at  a  fore- 
;  directors  appoint 
lall  not  be  lawful 
ase  of  any  stock 
Stockholders  are 
lin  restrictions  on 
3,  guardians,  trus- 

3n  Law,  chapter  iii. 
*  /(/. ,  chapter  xli. 
'/(/. ,  chapter  xii. 


77 


NEW  YORK. 


§  27 


tees  and  pledgees  are  not  liable  on  stock,  p.  1741.  May  borrow  money, 
issue  bonds  and  mortgages,  and  the  directors  may  authorize  the  con- 
version of  bonds  into  stock,  but  an  increase  of  stock  is  to  be  authorized 
by  the  stockholders  only,  p.  1752.  Elaborate  reports  to  the  state  are 
required.  Id.  The  legislature  may  reduce  rates  when  the  profits  exceed 
ten  per  cent  of  the  actual  cash  invested,  p.  1759.  Powers  are  to  cease 
unless  the  company  begins  construction  and  expends  ten  per  cent  of 
its  capital  within  five  years,  and  completes  the  work  within  seven  years, 
p.  1762,  §47.1  Or  within  ten  years,  p.  1764.  Connecting  lines  may 
consolidate,  p.  1766.^*  Any  number  of  persons  may  incorporate  to  con- 
struct, maintain  and  operate  a  railroad  in  a  foreign  company,  and  are 
given  liberal  powers,  and  at  least  one  meeting  of  the  stockholders  each 
year  is  to  be  held  in  the  state  for  elections,  p.  1767.  Railroads  may 
contract  with  each  other  "for  the  use  of  their  respective  roads,"  p.  1771.* 
A  railroad  is  liable  for  loss  of  freight  received  by  it  and  lost  on  a  con- 
necting line,  p.  1772.  A  lessee  railroad  may  purchase  the  stock  of  the 
lessor  railroad  and  on  purchase  of  the  whole  stock  shall  own  it,  pp.  1780, 
1782.  A  mortgagee  may  purchase  a  railroad  at  a  foreclosure  sale,  p. 
1781.  Connecting  railroads  may  consolidate  upon  the  consent  of  two- 
thirds  of  the  stockholders  in  interest,  but  this  is  not  applicable  to  paral- 
lel or  competing  lines,  p.  1783.^  On  foreclosure  sale,  the  purchasers 
may  incorporate  and  have  all  the  rights  and  privileges  of  the  old  corpo- 
ration, and  may  make  the  plan  of  reorganization  a  part  of  the  new  charter. 
A  majority  must  be  citizens  and  residents;  the  charter  may  regulate  the 
right  to  vote;  it  may  issue  stock  and  bonds  and  settle  claims  against  the 
old  corporation;  the  receiver's  liability  is  limited,  and  stockholders  may 
come  into  the  reorganization,  within  six  months  after  organization,  p. 
1788.5  A  New  York  railroad  may  consolidate  with  Pennsylvania  rail- 
road corporations,  p.  1789.  A  foreclosure  of  mortgage  on  aconsolidated 
road,  partly  in  the  state,  may  be  had,  p.  1791.  Stockholders  are  pro- 
hibited from  selling  proxies,  p.  1793.  Railroads  may  invest  in  stock  of 
union  depot  companies,  p.  2013.  Private  railroads  are  authorized,  p. 
1402. 

The  inspectors  of  election  may  require  any  voter  to  take  an  oath  as  to 
the  ownership  of  stock  and  that  he  is  not  paid  for  voting.  Proxies  also 
may  be  compelled  to  take  oath,  p.  1793.  A  railroad  commissioner  has 
power  to  investigate  and  report,  p.  1840,  etc.  The  capital  stock  may 
be  increased,  ch.  426,  L.  1889. 

— The  old  New  York  banking  act  was  the  model  upon  which 

•Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxviii. 
»/</..  chapter  xi.  •/</.,  chapter  xl.  */</.,  chapter  xl. 

'/</.,  chapter  xxxix. 


|. 


tiS  -^ 


§  27 


NEW  YORK. 


78 


the  present  national  banking  act  was  framed.  The  New  York  act  was 
re-enacted  and  remodelled  in  1882,  ch.  409,  L.  1882,  R.  S.,  8th.  ed., 
pp.  15 14,  etc.  Any  member  may  incorporate,  §  29.  Individual  bank- 
ens  must  file  a  certificate  of  residence,  §  32.  Loans  must  not  exceed 
three  times  the  capital  stock,  §  179.1  The  method  of  ascertaining  pro- 
fits for  declarmg  dividends  is  prescribed,  §  181.  At  elections  an  oath 
may  be  administered  to  stockholders,  §  202.  So  also  as  to  proxies, 
g§  203-264.  Persons  complaining  of  unfairness  or  illegality  at  elec- 
tions may  have  the  matter  reviewed  by  the  courts,  §§  210-213.  Stock- 
holders are  liable  for  debts  to  the  •'  extent  "  of  their  stock;  also  subject 
to  assf^ssments  to  repair  the  capital,  §  125,  ch.  191,  L.  1882,  R.  S., 
8th  cd.,  1586.2  Upon  the  application  of  creditors  or  stockholders 
having  §1,000  interest  in  the  bank,  the  courts  may  order  a  master  in 
chancery  to  make  an  exemination  of  its  condition,  ch.  409,  L.  1882,  §  19. 
Upon  the  consolidation  of  banks,  a  dissenting  stockholder  may  demand 
the  value  of  his  stock.  Id.  §  56.  The  provisions  for  the  issue  of  paper 
money  are  also  re-enacted,  §§  70-123. 

Trust  companies  are  organized  under  ch.  546,  L.  1887,  R.  S.,  8th  ed., 
p.  1596.  Stockholders  in  trust  companies  are  liable  for  its  debts  to  the 
■extent  of  the  par  value  of  their  stock,  ch.  558,  L.  1889. 

Savings  banks  have  no  stockholders. 

General  Provisions.— Corporations  must  organize  and  commence 
business  within  a  year  from  their  incorporation  or  their  powers  cease, 
R.  S.,  8th  ed.,  p.  1724.*  Charters  are  subject  to  alteration,  suspension 
and  repeal.  Id.  No  corporation  shall  discount  paper  and  receive  de- 
posits and  do  a  banking  business  unless  it  is  expressly  uicorporated  for 
banking  purposes,  p.  1723. •»  Transfer  books  are  to  be  open  to  stock- 
holders for  thirty  days  before  elections,  p.  1728.'  Notes  shall  not  be 
received  from  stockholders  in  payment  of  subscriptions,  Id.  Corporate 
debts  shall  not  exceed  three  times  the  capital  stock, «  and  if  they  do  the 
guilty  directors  ohall  be  liable  to  creditors  to  the  extent  of  the  excess, 
Id.  §  3.  After  a  refusal  to  pay  its  notes  or  other  evidence  of  debts, 
.a  corporation  cannot  assign  anything  to  an  officet  ^r  stockholder  to  pay 
a  debt,  nor  shall  it  assign  to  any  one  in  contemplation  of  insolvency, 
p.  1729,  §4.'"*  Stockholders  complaining  of  unfairness  or  illegality  at 
.elections  may  have  the  same  remedied  by  the  courts.  Id.  §  5.  Inspec- 
tors of  election  must  take  an  oath,  §  7.  If  no  election  is  held  at  the 
prescribed  time,  it  must  be  held  within  sixty  days  and  no  intervening 
transfers  are  to  change  the  right  to  vote,  §  8.     The  above  provisions 

'Cook  on  Stock  and  Stockholders  and  General   Corporation  Law,   chapter  xli. 
»W.,  chaptei  xii.  •/</.,  chapter  xxxviii.  Vrf.,  chapter  xH. 

'</.,  chapter  XXX.  •/</.,  chapter  xli.  '/</.  chapter  xli. 


I'^mmm- 


78 

New  York  act  was 
2,  R.  S.,  8th.  ed., 
I.  Individual  bank-  • 
ins  must  not  exceed 
3f  ascertaining  pro- 
t  elections  an  oath 

also  as  to  proxies, 
r  illegality  at  elec- 
;§  210-213.  Stock- 
r  stock;  also  subject 
91,  L.  1882,  R.  S., 
ors  or  stockholders 
ay  order  a  master  in 
1.  409,  L.  1882,  §  19. 
cholder  may  demand 
)r  the  issue  of  paper 

1887,  R.  S.,  8th  ed., 
e  for  its  debts  to  the 
889. 

ize  and  commence 
their  powers  cease, 
Iteration,  suspension 
per  and  receive  de- 
sly  uicorporated  for 
)  be  open  to  stock- 
Notes  shall  not  be 
;ions,  Id.  Corporate 
:,*  and  if  they  do  the 
:tent  of  the  excess, 
er  evidence  of  debts, 
r  stockholder  to  pay 
ation  of  insolvency, 
ness  or  illegality  at 
s.  Id.  §  5.  Inspec- 
;tion  is  held  at  the 
and  no  intervening 
he  above  provisions 

tion  Law,  chapter  xli. 
*/</.,  chapter  xli. 
'/(/.  chapter  xli. 


-?9 


NEW  YORK. 


§  27 


are  not  applicable  to  moneyed  corporations,  §  11.  Foreign  corporations 
may  hold  land,  p.  1737,  ch.  450,  L.  1887."  Transfer  agents,  in  this 
state,  of  foreign  corporations  must  exhibit  the  transfer  book  to  stock- 
holders, p.  1731,  L.  1842,  ch.  165. '■*  "No  corporation  shall  hereafter 
interpose  the  defence  of  usury  in  any  action,"  p.  1732,  L.  1850,  ch. 
172.  Domestic  corporation  may  purchase  land  in  another  state,  or 
stock  in  land  companies  therein,  so  far  as  such  land  is  needed  for  its 
business,  p.  1733,  L.  1872,  ch.  146.  The  issue  of  new  certificates  in 
case  of  loss  of  the  old  ones  is  regulated  by  statute,  p.  1734,  L-  1873, 
ch.  151.  The  purchasers  of  corporate  property  and  franchises  at  a 
foreclosure  sale  may  incorporate  themselves  and  exercise  and  have  all 
the  rights  and  privileges  of  the  old  corporation,  p.  1735,  L.  1873,  ch. 
469,  L.  1880,  ch.  113.  Foreign  corporations  may  so  purchase,  p.  1736, 
■ch.  158,  L.  1877.  Corporations  may  increase  their  capital  stock,  p. 
1733,  or  decrease  it,  p.  1736.  Where  elections  are  not  held  and  officers 
hold  over,  the  stockholders  have  various  "-emedies,  p.  1725,  L.  1885, 
•ch.  489.  "  When  an  action  is  brought  by  a  creditor  wf  a  corporation, 
and  the  stockholders,  directors,  trustees,  or  other  officers,  or  any  of 
them,  are  made  liable  by  law,  in  any  event  or  contingency,  for  the  pay- 
ment of  his  debt,  the  persons  so  made  liable,  may  be  made  parties  de- 
fendant, by  the  original  or  by  a  supplementary  complaint;  and  this  lia- 
bility may  be  declared  and  enforced  by  the  judgment  in  the  action," 
Code  of  Civ.  Pro.,  §§  1790-1796.* 

The  usury  laws  do  not  apply  to  demand  loans  of  over  $S,ooo,  where 
•certificates  of  stock  are  given  as  collateral  security,  ch.  237,  L.  1882. 
Corporations  shall  pay  their  employes  in  cash  and  not  in  store  orders, 
ch.  381,  L.  1889. 

Taxation.^ — Before  obtaining  a  charter  a  license  fee  to  the  state  of 
one-eighth  of  one  per  cent  of  the  capital  stock  must  be  paid,  p.  1159, 
ch.  143,  L.  1886.  Except  in  the  case  of  banks.  Id.  ch.  248,  1887. 
The  fee  must  be  paid  also  upon  increasing  the  capital  stock,  1159. 
Shares  of  stock  in  corporations  liable  to  taxation  on  their  c; 
exempt  from  taxation,  R.  S.,  8th  ed.,  p.  1084,  §  7.  All  don 
porations  and  foreign  corporations  doing  business  in  the  stu  i 
savings  banks,  institutions  for  savings,  life  insurance  compai 
ance  companies,  banks  and  foreign  insurance  companies, 
facturing  and  mining  companies  doing  business  in  tb 
including  gas  or  trust  companies,  shall  pay  to  the  state  .  annual  tax 
of  a  quarter  of  a  mill  on  the  par  value  of  the  stock  lur  each  one 
per  cent  dividend  declared,  during  the  year,  if  it  be  a  six  per  cent 

'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xli. 
*/</.,  chapter  xxx.  *Id.,  chapters  xi.  and  xii.  •/</.,  caapter  xxxiv. 


ai  are 

c  cor- 

<     except 

insur- 

1  manu- 

tate,    not 


iT  ^' 


T 


NORTH  CAROLINA, 


80 


dividend  or  over.  If  less  than  six  per  cent  then  the  tax  is  a  mill- 
and-a-half  on  the  actual  value  of  ail  the  sharo  of  stock.  In  the 
latter  case,  the  assessed  value  of  the 'real  estate  within  the  state 
to  be  deducted,  but  no  deduction  is  to  be  allowed  for  debts,  p.  1152, 
L.  1881,  ch.  361,  amending  L.  1880,  ch.  542,  amended  by  L.  1885, 
ch.  359,  and  see  Amendment,  ch.  353  and  ch.  193,  L.  1889.  Only 
such  part  of  the  value  of  the  capital  stock  shall  be  taxed  as  is  em- 
ployed within  the  state,  ch.  501,  L.  1885.  Manufacturing  or  mining 
corporations  carrying  on  their  work  in  the  state  do  not  pay  any  state 
tax,  p.  1153,  ch.  359,  L.  1885.  Domestic  corporations  doing  business, 
elsewhere  are  ta.\ed  only  on  the  capital  used  in  the  state,  §  11.  Banks- 
pay  a  state  and  local  tax,  which  is  levied  on  the  shares  of  stock  and  de- 
duct the  same  from  dividends  or  the  stock  may  be  sold,  or  a  lien 
allowed  to  rest  upon  it.  The  bank  pays  also  a  tax  on  its  real  estate^ 
pp.  1580  etc.,  ch.  409,  L.  1882,  §§  312-327.  The  state  also  taxes  the 
real  estate  of  corporations  as  it  does  the  real  estate  of  individuals,  p.. 
1155^  ch.  361,  L.  1881,  §  8.  In  addition  to  all  this,  all  corporations^ 
transporting  freight  or  passengers,  also  telegraph  and  telephone  com- 
panies, shall  pay  a  tax  of  one-half  of  one  per  cent  of  its  gross, 
earnings  in  this  state.  Id.  §  6,  Real  estate  of  corporations  are  taxed 
where  it  lies,  but  the  personal  property  and  capital  stock  are  taxed 
where  the  principal  place  of  business  is,  R.  S.,  8th  ed.,  p.  1149.  The 
above  provisions  for  state  taxes  and  exemptions  from  taxation  do  not 
apply  to  taxes  levied  by  the  municipalities.  In  New  York  city,  where 
the  municipal  tax  is  about  two  per  cent  on  a  sixty  per  cent  valu- 
ation, and  the  state  tax  is  not  over  one-half  of  one  per  cent,  the  im- 
portance of  the  municipal  tax  becomes  apparent.  See  People  v.  Daven- 
port, 91,  N.  Y.,  574  (1883).  A  valuation  of  the  capital  stock  is  ob- 
tained by  deducting  from  the  actual  value  of  its  capital  stock  and 
surplus  exceeding  ten  per  cent  of  the  capital,  the  value  of  real  estate 
and  shares  of  stock  owned  by  the  corporation,  p.  io86,  ch.  456, 
L.  1857. 

8  28.  NORTH  CAROLINA.  Constitutional  Provisions.— Corporations 
are  to  be  created  by  general  lav.s,  except  for  purposes  tha.  cannot  be  so 
attained,  Art.  VIII.,  §  i. 

Miscellancoas  CorporatIon8.~Three  or  more  may  incorporate  for  any 
lawful  business.  Code  §  677.  Dividends  are  prohibited  when  the  debts 
exceed  two-thirds  of  its  assets,  §  681.  Contracts  incurring  a  corporate 
liability  of  over  f  100  shall  be  in  writing  and  sealed,  with  the  corporate 
seal  or  signed  by  an  authorized  officer,  §  683.  The  following  provision 
also  exists:      '  It  shall  be  the  duty  of  the  attorney  general  to  bring  an 


^ 

f 


80 

1  the  tax  is  a  mill- 
f  stock.  In  the 
;  within  the  state 
for  debts,  p.  1152, 
jnded  by  L.  1885, 
13,  L.  1889.  Only 
c  taxed  as  is  em- 
icturing  or  mining 
not  pay  any  state 
ms  doing  business 
;tate,  §11.  Banks 
es  of  stock  and  de- 
be  sold,  or  a  lien 

on  its  real  estate^ 
tate  also  taxes  the 
;  of  individuals,  p.. 
s,  all  corporations 
id  telephone  com- 
ment of  its  gross 
porations  are  taxed 
al  stock  are  taxed 
ed.,  p.  1 149.  The 
<m  taxation  do  not 
w  York  city,  where 
ty  per  cent  valu- 
e  per  cent,  the  im- 
;e  People  v.  Daven- 
:apital  stock  is  ob- 

capital  stock  and 
alue  of  real  estate 

p.    io86,  ch.   456, 


ilons.— Corporations 
;s  tha.  cannot  be  so 

incorporate  for  any 
ted  when  the  debts 
curring  a  corporate 

with  the  corporate 
following  provision 
;eneral  to  bring  an 


81 


NORTH  CAROLINA. 


8  28 


action  in  the  superior  court  of  the  county,  as  in  this  Code  directed,  to 
restrain  by  injunction,  any  corporation  from  assuming  or  exercising  any 
franchise,  or  transacting  any  business  not  allowed  by  its  charter;  to  re- 
strain any  person  from  exercising  corporate  franchises  not  granted;  to 
bring  directors,  managers  and  officers  of  a  corporation,  or  the  trustees 
of  funds  given  for  a  public  or  charitable  purpose,  to  an  account  for  the 
management  and  disposition  of  the  property  confided  to  their  care-  to 
remove  such  officers  or  trustees  upon  proof  of  gross  misconduct;  to  se- 
cure for  the  benefit  of  ail  interested,  the  property  or  funds  aforesaid;  to 
set  aside  and  restrain  improper  alienations  thereof,  and  generally  to 
compel  the  faithful  performance  of  duty,  and  present  all  malversation,, 
peculation  and  waste.  And  in  case  of  fraud  by  the  president,  directors,, 
managers  or  stockholders  in  any  corporation,  the  court  shall  render 
personally  liable  to  creditors  and  others  injured  thereby,  such  of  the 
directors  and  stockholders  as  may  have  been  concerned  in  the  fraud  '" 
Id.  §  686.  The  articles  of  incorporation  may  be  amended,  ch.  19 
Laws  of  1885. 

Railroads — Twenty-five  or  more  may  incorporate,  Code  §  1932.  StocI 
must  have  been  owned  thirty  days  in  order  to  be  voted,  "  ":i6.  Direct- 
ors are  to  be  stockholders,  and  corporate  books  and  r  \  i  \  a  are  to  be 
open  to  inspection  at  elections  if  a  majority  of  the  stockl  olders  present 
so  desire,  §  1936.  Stockholders  are  liable  to  laborers  for  thirty  days" 
wages,  §  1940.  Rates  may  be  reduced  when  an  examination  by  the 
state  auditor  shows  that  the  profits  exceed  six  per  cent  of  the  capital 
actually  expended,  §  1961. 

Geaeral  Provisions — No  company,  except  railroad,  manufacturing,, 
mining  or  water  works  companies,  shall  own  in  fee  over  three  hundred', 
acres  of  land,  nor  hold  a  longer  term  than  thirty  years,  §  666. 

Taxation — By  ch.  177,  Laws    1885,  resident  owners  of  shares   of 
stock  are  required  to  list  them  for  taxation.     Corporations  are  taxed  or» 
their  personalty  at  the  principal  place  of  business.     Shares  of  stock  \n 
banks  are  taxed  and  the  tax  paid  by  the  bank.    "  Stockholders  in  valu- 
ing their  shares  may  deduct  their  ratable  proportion  of  the  value  of 
taxable  property,  the  tax  whereof  is  paid  by  the  corporation."  Railroads 
and  transportation  companies  are  assessed  by  a  state  board,  and  the 
assessment  apportioned  to  the  proper  municipalities,     A   registry  of 
transfer  is  prohibited  after  notice  is  given  to  the  corporation  of  non- 
payment of  the  tax.     The  corporation  may  pay  the  stockholder's  tax 
and  deduct  the  same  from  the  dividend  thereon.    A  fee  of  $25  is  charg-. 
ed  for  recording  the  articles  of  association.  Code  §  678.      Also  a  fee 
of  $2,  §  680.     Railroad  corporations  must  pay  a  license  fee  of  $50  to  . 
the  secretary  of  state  in  order  to  obtain  a  charter,  §  1933..    Also  a  fee- 


4 


I   t 

1 


f 


•8  29 


NORTH  DAKOTA. 


82 


•of  $25  if  a  special  charter  is  sought,  ch.  33,  L.  1885.  Or  an  amend- 
.ment,  ch.  36  and  93,  L.  1885. 

By  ch.  135,  L.  1887,  all  limitations  and  exemptions  of  private  cor- 
porate property  fr(  m  taxation  are  repealeil  and  all  are  made  subject 
.to  taxation. 

Cashiers  of  banks  shall  pay  the  tax  on  shares  of  stock. 

Hank  stock  is  assessed  in  the  county  of  the  bank  for  school  and 
icounty  purposes  only. 

All  existing  exemptions  of  corporations  from  taxation  are  repealed 
IL.  1889,  p.  180. 

Shares  of  stock  are  taxed  and  the  corporation  pays  the  tax,  L.  1889, 
ip.  197. 


■►»' 


II 


%• 


§  29.  NOATH  DAKOTA.— In  February,  1889,  by  act  of  Congress, 
the  territory  of  Dakota  was  divided  and  admitted  into  the  Union  as 
North  Dakota  and  South  Dakota.     In  August,  1889,  the  constitutional 

•  convention  of  North  Dakota  submitted  to 'the  people  for  adoption  a 
constitution  in  which  appear  the  following  provisions: 

Constitutional  Provisions.— No  special  privilege  or  immunities  shall 

•  ever  be  granted  which  may  not  be  altered,  revoked  or  repealed  by  the 
^legislative  assembly,  Art.  I.,  §  20.  No  special  or  local  law  shall  be 
..passed  granting  to  any  corporation,  association  or  individual  the  right 
to  lay  down  railroad  tracks,  or  any  special  or  exclusive  privilege, 
immunity  or  franchise  whatever,  Art,  II.,  §  69,  Charters  shall  be 
,;;ranted  only  by  general  laws  and  are  subject  to  alteration  or  repeal, 
Art.  VIII.,  §  131.     Cumulative  voting  at  elections  is  provided  for,  Id. 

.  §  135.     A  foreign  corporation  cannot  do  business  in  the  state  unless  it 
,has  an  office  and  an  agent  in  the  state  upon  whom  process  may  be 
■served,  Id.  §  136.     "Watered"  stock  and  bonds  are  to  be  void.     An 
increase    of  stock  or  bonds  can  be  made    only   after    a  majority  in 
interest  of  the  stockholders  assent  thereto  at  a  meeting  called  on  a 
sixty  days'  notice,  Id.  §  138.     Street  railroad,  tel' graph,  telephone  and 
electric  light  plant  shall  be  put  into  a  town   o     city  only  after    the 
local  authorities  controlling  the  streets  assent  thereto,  Id,  §  139.     Do- 
mestic railroad  corporations  doing  business  in  the  state  must  keep  in 
.the  state  a  public  office  for  the  transaction  of  its  business  where  trans- 
.  fers  of  its  stock  shall  be   made  and  where  books  shall  be  kept  open 
ito  public  inspection,  giving  the    amount  of     capital    subscribed,    the 
subscribers,  the  stockholders,  the    amount  of   stock  owned   by  each, 
,the  amount  of  subscription  paid  in,    transfers   of  stock,  the  amount  of 
■corporate  assets  and  liabilities,  and  the   names  and   residences  of  the 
.officers.     Annual  reports  must  be  made  by  the   directors  to   the  state, 


82 


08 


OHIO. 


8  30 


185.    Or  an  amend- 

ons  of  private  cor- 
II  are  made  subject 

stock, 
sank  for  school  and 

ixation  are  repealed 

lys  the  tax,  L.  1889, 


by  act  of  Congress, 
I  into  the  Union  as 
9,  the  constitutional 
ople  for  adoption  a 
ns: 

I  or  immunities  shall 
1  or  repealed  by  the 
)r  local  law  shall  be 
■  individual  the  right 

exclusive  privilege, 
Charters  shall  be 
alteration  or  repeal, 
i  is  provided  for.  Id. 
in  the  state  unless  it 
lom  process  may  be 

are  to  be  void.     An 

after  a  majority  in 
meeting  called  on  a 
jraph,  telephone  and 

city  only  after  the 
•eto,  Id.  §  139.  Do- 
i  state  must  keep  in 
business  where  trans- 
s  shall  be  kept  open 
)ital  subscribed,  the 
;ock  owned   by  each, 

stock,  the  amount  of 
id  residences  of  the 
irectors  to   the  state. 


III.  §  140.  Consolidations  of  competing  or  parallel  lines  arc  forbidden. 
Sixty  days' notice  of  meetings  called  to  effect  a  consolidation  must  be 
given,  Id.  §  141.  The  rates  charged  by  railroad,  sleeping  car, 
telegraph,  telephone  and  transporlation  companies  may  be  reduced  by 
the  state,  subject  to  a  review  of  the  rediiction  by  the  courts,  id.  .*<  142. 
"Any  combination,  between  individuals,  corporations,  associations,  or 
either  having  for  its  object  or  effect  the  controlling  of  the  price  of  any 
product  of  the  soil  or  any  article  of  manufacture  or  commerce,  or  the 
cost  of  exchange  or  transportation,  is  prohibited  and  hereby  declared 
unlawful  and  against  public  policy  "  and  the  charters  of  corporations 
entering  into  such  "shall  be  deemed  annulled  and  become  void,"  Id. 
§  146.  The  legislature  may  allow  a  railroad  to  pay  to  the  state  a  per- 
centage of  its  "gross  earnings"  in  lieu  of  all  state,  county,  township  and 
school  taxes  on  its  property  including  its  road  bed,  right  of  way,  shops, 
buildings  and  other  property  used  in  its  common  carrier  business,  Art. 
XI.,  §  176.  Otherwise  a  state  board  is  to  assess  the  railroad  and  ap- 
portion it  for  taxation  among  the  municipalities  through  which  it  runs, 
Id.  §  179.  The  right  of  taxation  shall  not  be  surrendered  or  suspemled 
by  the  state  or  any  municipality.  Id.  §  178.  Neither  the  state  nor  any 
municipality  "  shall  loan  or  give  its  credit  or  make  donations  to  or  in 
aid  of  any  corporation,  nor  subscribe  to  or  become  the  owner  of  any 
association  or  corporation,"  but  the  state  on  a  two-thirds  vote  of  the 
people,  may  engage  in  a  work  of  internal  improvement,  Art.  XII., 
§185.  "The  exchange  of 'black  lists' between  corporations  shall  be 
prohibited,"  Art.  XVII.,  §  212. 

Hiscellaneons  Corporotions.— By  the  constitution  of  August,  1889,  the 
territorial  statutes  of  Dakota  are  continued  in  force  until  they  may  be 
changed  by  the  new  state.  •  These  statutes,  so  far  as  they  relate  to  cor- 
poration law,  are  given  in  §  35  in/ra,  under  the  beading  South  Dakota. 

§  30.  OHIO.  Constltntlonal  Provisions.— The  state  shall  not  give 
or  loan  its  credit  to,  nor  take  stock  in  any  corporation.  Const,  of  105 1, 
Art.  VIII.,  §  4.  The  general  assembly  is  forbidden  to  authorize 
municipalities  to  aid  any  corporation,  Art.  VIII.,  §  6.  Joint  stock 
companies  and  stock  shall  be  taxed.  Art.  XII.,  §  2.  Banks  and  bank 
investments  shall  be  taxed,  Id.  §  3.  Special  acts  of  incorporation  are 
prohibited,  Art.  XIII.,  §  I.  "  In  all  cases,  each  stockholder  shall  be 
liable,  over  and  above  the  stock  by  him  or  her  owned,,  and  any  amount 
unpaid  thereon,  co  a  further  sum,  at  least  equal  in  amount  to  such 
stock,"  Id.  §  3.1  "  The  property  of  corporations,  now  existiiig  or  here- 
after crirated,  shall  forever  be   subject  to  taxation,  the  same  as   the 

'■  Cook  on  Stock  and  Stcckholdcirs  and  General  Corporation  Law,  chapter  xii. 


:J 


.1 


8  30 


OHIO. 


84 


property  of  iiulivitluals,"  Id.  g  4.'     Acts  authorizing  l)ankiii^j  corpora- 
tioiiii  must  first  l)e  sulxnitted  to  anil  approved  hy  a  vote  of  the    i)eople. 

Id.  87. 

MiHccllaiieoiiH  CorporatioiiH.— May  be  formed  for  any  lejjal  purpose, 

except  for  dealing  in  real  estate  or  for  professional  business,  R.  S.  1886, 
|5  32.35.  A  majority  of  the  incorporators  must  i)e  citizens  of  Ohio,  § 
3236.  Ten  per  cent  of  each  share  subscribed  for  must  be  paid  in  at 
the  time  of  subscribing,  ^  3243.  i'ifty  per  cent  of  the  capital  stock 
must  be  subi'cribed  and  ten  per  cent  paid  in  before  the  charter  is 
granteil.  Incorporators  are  liable  for  any  deficiency  as  to  the  ten  per 
cent,  §3244.  No  stock  can  be  voted  on  which  an  installment  is  due 
and  unpaid,  §  3245.  Articles  of  association  may  limit  each  stockholder 
to  one  vote,  irrespective  of  the  amount  of  stock  held  by  him.*  In  such 
a  case  no  one  can  own  over  $1,000  par  value  of  stock.  Annual  reports 
shall  be  made  by  the  directors,  under  a  penalty.  Hy-laws  distributing 
the  profits  among  workmen,  etc.,  shall  be  legal.  Act  of  March  19,  1884, 
R.  S.  Suppm't,  p.  215.  A  majority  of  the  dirtctors  must  be  stockholders 
and  citizens  of  Ohio."  Receivers  must  also  be  citizens,  §  3248.  Di- 
rectors may  make  the  by-laws,  §  3250.  All  paid-up  stock  is  subject 
to  levy  of  execution,  §  3255.  I'he  corporation  may  borrow  money,  not 
exceeding  the  amount  of  its  capital  stock,*  and  give  its  note,  bond  and 
mortgage  therefor,  §3256.  Gn  a  vote  of  three-fourths  of  the  stock- 
holders, representing  three-fourths  of  the  capital  actually  paid  in,  bonds 
maybe  issued  not  exceeding"  one-half  the  value  of  the  capital  stock 
actually  paid  in,  such  bonds  to  be  convertible  into  stock,  common  or 
preferred,  §  3257.  Stockholders  are  liable  to  corporate  creditors  for 
the  par  value  of  their  stock  in  addition  to  the  unpaid  subscription.  The 
unregistered  owner  also  is  so  liable,  §§  325S,  3259.'  An  action  to  en- 
force this  liability  must  be  for  all  creditors,  against  all  stockholders, 
g  3260,  Thr^e-fourths  of  all  the  stockholders,  representing  three- 
fourths  of  the  stock,  may  authorize  the  issue  of  preferred  stock,  §  3263. 
The  corporation  must  furnish  each  stockholder,  annually,  a  statement 
of  its  financial  condition  and  a  list  of  the  stockholders  and  their 
residence,  §  3268.  One-fifth  in  interest  of  the  stockholders  in  a  manu- 
facturing corporation,  not  profitable,  may  force  a  dissolution,  §  5673. 
Net  profits  available  for  dividends  are  ascertained  by  deducting  all  ordin- 
ary and  extraordinary  expenses  paid  or  incurred  in  the  management  of 
the  corporate  affairs  or  the  transaction  of  its  business;  interest  paid,  due 
or  accrued  on  corporate  debts;  losses,  including  debts  due  upon  which 

'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxiv. 
'/rf.,  chapter  xxxvii.  '/</.  */</.,  chapter  xli. 

•/(/.  '/<^<  >  chapters  xii.  and  xv. 


84 

g  l)anking  corpora- 
)te  of  the   people, 

any  legal  purpose, 
siness,  R.  S.  1886, 
itizens  of  Ohio,  § 
list  be   paid  in   at 

the  capital    stock 
ore   the  charter   i» 
zy  as  to  the  ten  per 
installment  is  due 
lit  each  stockholder 
by  hini.'*     In  such 
c.     Annual   reports 
y-laws    distributing 
of  March  19,  1884, 
lust  be  stockholders 
zens,  §  3248.     Di- 
p   stock  is   subject 
borrow  money,  not 
;  its  note,  bond  and 
irths   of  the   stock- 
ually  paid  in,  bonds 
»f  the  capital  stock 
stock,  common   or 
)orate  creditors   for 
i  subscription.    The 

An  action  to  en- 
st  all  stockholders, 
representing  three- 
;erred  stock,  §  3263. 
nually,  a  statement 
ckholders  and  their 
kholders  in  a  manu- 
iissolution,  §  5673. 
r  deducting  all  ordin- 
i  the  management  of 
ss;  interest  paid,  due 
lebts  due  upon  which 

jnLaw,  chapter  xxxiv. 
*/d.,  chapter  xU. 


B$ 


OHIO. 


»  SO 


no  interest  has  been  paid  for  a  year  and  no  suit  bron^iht  thereon,  or 
tipon  which  suit  has  been  brought  and  no  interest  paid  for  two  years. 
Only  the  capital  stock  actually  paid  in  shall  be  advertised,  L.  1889, 
p.  228. 

Rallronds.— Are  incorporated  under  the  above  provisions.  A  change 
of  route  renders  the  company  liable  to  suits  for  damages  and  to  cancella- 
tion of  subscriptions,  g  3276.  May  issue  bonds  for  certain  specified 
purposes,'  and  secure  the  same  by  mortgage,  {^  3286.  May  open 
transfer  books  in  other  states,  ^  3291.  Stockholders  voting  must  have 
been  such  for  thirty  days  previous  to  the  election,  g  3296.  A  railroad 
may  aid,  purchase,  lease  or  make  a  traffic  contract  with  a  connecting 
''"<^>  §  3300-  J^"t  only  on  a  two-thirds  vote  of  all  the  stock  of  each 
company,  and  any  rental  must  be  equal  to  the  net  earnings  of  the  pre- 
ceding year,  §  3301,  Dissenting  stockholders  must  be  bought  out  and 
paid  the  value  of  their  stock,  §  3302,  etc.  The  liabilities  of  the  lessor  and 
lessee  are  defined,  §  3305,  Act  of  April  13,  1883.  Preferred  stock  may 
be  issued  when  the  capital  stock  is  increased,  g  3309.  A  record  of  all 
proceedings  shall  be  kept  in  the  state  and  be  "  open  at  reasonable 
hours  for  the  inspection  of  any  stockholder  of  the  company,"  §  3312.' 
"  All  capital  stock,  bonds,  notes,  or  other  securities  of  a  company, 
purchased  of  the  company  by  a  director  thereof,  either  directly  or  in- 
directly, for  less  than  par  value  thereof,  shall  be  null  and  void." 
"The  directors  shall  be  liable  in  their  individual  capacity  to  the 
stockholders  for  any  damage  sustained  by  the  stockholders  by  reason  of 
the  negligence,  mismanagement,  or  unfaithfulness  in  the  discharge  of 
their  duties  ;  but  a  director  may  exonerate  himself  by  entering  his  pro- 
test upon  the  record  against  any  act  done  without  his  concurrence, 
from  which  injury  is  feared,  and  fo  'liwith  publishing  the  same  for  three 
weeks  in  sonrie  newspaper  printed  and  of  general  circulation  in  the 
county  in  which  is  the  principal  office  of  the  company,"  §  3314.  No 
stockholder  in  an  express  or  transportation  company  shall  hold  office 
in  a  railroad  company,  §  3315.  Consolidations  are  authorized  on  a 
two-thirds  vote  of  the  stock  voted  at  a  meeting  called  for  that  purpose, 
§  3381.  "  A  stockholder  who  refuses  to  convert  his  stock  into  the 
stock  of  the  consolidated  csmpany  shall  be  paid  the  highest  market 
value  of  such  stock  at  any  time  within  six  months  next  preceding  the 
time  of  the  making  of  such  agreement  for  consolidation  by  the  direc- 
tors, if,  previous  to  such  consolidation,  he  so  require  .  .  ."  §§3388, 
etc.  Reorganization  agreements  are  regulated  :  two-thirds  in  interest 
of  the  creditors  and  two-thirds  in  interest  of  the  stockholders  may  agree 

'  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter   xli. 

*/</ ,  chapter  xxx. 


,'-¥-'»'J:"a**V*'^,*.5*'''C:-''r?>*«!^^-!ii'.^"<'S";'*>s~V-." 


iTf"w;';:t!^--^ii 


§  31 


OREGON. 


86 


on  a  plan  of  reorganization  ;  the  court  may  then  order  a  sale  and  the 
committee  may  purchase  ;  a  meeting;  is  then  (ailed  ;  any  creditor  or 
stockholder  may  come  in  on  the  reorjjanization  within  a  year  alter 
such  meeting  ;  the  new  corporation  has  all  the  powers,  etc.,  of  the  old, 
and  also  adilitional  powers,  Jj}|  3393-3398.  Foreign  corjiorations  may  do 
business  in  the  state,  g  3399.  Recapitalization  without  foreclosure  is 
provided  for  on  a  two-thirds  vote  of  the  l)ondholders,  general  creditors 
anti  stockholders.  Those  not  coming  in  within  six  years  after 
publication  are  barretl  out,  imiess  they  were  under  disability,  |555  34°'- 
3408.  The  sale  of  an  unfinished  road  is  authorized.  Dissenting  stock- 
holders are  protected,  ^g  3409-3414.  The  purchasers  of  a  railroatl  at 
a  foreclosure  sale  may  succeed  to  the  old  corporate  franchise  on  the 
consent  of  the  directors  and  two-thirds  of  the  stock,  §  3419.  Or  may 
organize  a  new  cor|)oration,  g  3426.  See  also  Act  of  March  11,  1880, 
R.  S.  Suppm't,  pp.  225,  226.  A  railroad  commissioner  is  given  power  to 
investigate  and  report,  R.  S.  1886,  p.  53,  ch.  7. 

Contracts  relating  to  the  use,  sale,  etc.,  of  rolling  stock  or  other 
personal  property  by  a  railroad,  must  be  filed  with  the  secretary  of 
state,  L.  1889,  p.  255. 

Taxation.' — For  fiUng  a  certificate  of  incorporation,  a  fee  must  be 
paid  to  the  secretary  of  state  varying  from  $5  ,  where  the  capital 
stock  is  $5,000  or  less,  to:j!2oo  when  the  capital  stock  is  over  $1,000,000, 
R.  S.  Suppm't,  §  148,  amended  L.  1886,  p.  165.  Shares  of  stock  are 
taxed,  §g  2731-2737.  They  are  assessed  at  their  actual  value,  g  2739. 
All  corporations,  unless  otherwise  specifically  taxed,  are  taxed  on  their 
realty  where  it  lies  and  on  their  personalty  by  municipalities  in  propor- 
tion to  the  value  of  the  realty  therein  to  the  whole  realty  in  the  state, 
§  2744.  Shares  of  stock  are  not  taxed  if  the  capital  stock  is  taxed 
against  the  corporation,  §  2746.  Bank  stock  is  taxed,  at  its  actual 
value,  in  the  municipality  where  the  bank  is  located,  §  2763.  Bank 
realty  is  taxed  where  it  lies,  §  2763.  Railroad  property,  real  and 
personal,  is  assessed  by  a  board  and  apportioned  among  the  muni- 
cipalities through  which  the  road  runs,  §§  2770-2776,  see  also  Act  of 
April  27,  1885.  Bank  taxes  may  be  paid  by  the  bank  and  deducted 
from  the  dividends.  The  tax  is  a  lien  on  the  stock,  §§  2839,  2840.  A 
railroad  running  into  another  state  is  taxed  only  on  the  proportion  of 
the  road  and  rolling  stock  in  the  state,  §  3387.  Foreign  insurance 
companies  are  taxed  on  their  gross  receipts  from  premiums,  L.  1888, 
p.  183. 

§  31.  OREGON.    Constitutional   Provisions.— No  bank  of  issue  shall 
be  incorporated,  Art.  II.,  §  1.     Corporations   can  be   created  only  by 
'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxiv. 


rder  a  sale  and  the 
il  ;  any  creditor  or 
kvitliiii  a  year  alter 
:rs,  etc.,  of  the  old, 
jorporations  may  do 
:hout  foreclosure  in 
s,  general  <:reditors 
lin  six  years  after 
disal)ility,  gg  34°'- 
,  Dissenting  stock- 
sers  of  a  railroad  at 
te  franchise  on  the 

<,  g  3419-  Or  "i»y 

of  March  11,  1880, 
ler  is  given  power  to 

)Hing  stock  or  other 
th   the   secretary  of 

tion,  a  fee  must  be 
,  where  the  capital 
k  is  over  $1,000,000, 
Shares  of  stock  are 
ictual  value,  §  2739. 
;d,  are  taxed  on  their 
iiicipalities  in  propor- 

realty  in  the  state, 
ipital  stock  is  taxed 
taxed,  at  its  actual 
ited,  §  2763.  Bank 
1  property,  real  and 
ed  among  the  muni- 
2776,  see  also  Act  of 

bank  and   deducted 

;k,  §§  2839,  2840.     A 

m  the   proportion   of 

Foreign   insurance 

premiums,  L.  1888, 

sfo  bank  of  issue  shall 
I  be  created  only  by 
ion  Law,  chapter  xxxiv. 


J  Ut^^,:.:.,:^^ 


-A5BB«e^.«U*«t'*«J»«:-!tJ««fcV 


IMAGE  EVALUATION 
TEST  TARGET  (MT-3) 


^ 


4V/  /I 


•r 


1.0 


I.I 


■u  1^   122 
us 

lU 

u 


lAO 


12.0 
■■ 


11125  III  , .4    ,,.6 

■ 

< 

6"     

► 

Photographic 

Sdences 

Corporation 


23  WEST  MAIN  STREET 

WEBSTER,  N.Y.  MStO 

(716)872-4S03 


*»«fs.\y 


4k.o 


J 


CIHM/ICMH 

Microfiche 

Series. 


CIHM/ICIVIH 
Collection  de 
microfiches. 


Canadian  Institute  for  Historical  ly/licroreproductions  /  Institut  Canadian  de  microreproductions  historiques 


mm 


fggggggiigi/jfiggtigiigiiggifg^^ 


wmmmammMimumc  nn.i  wmiii iwiimiiiiii  1 1     iimmmi^mmtitm^timKmmmaiatmmmimimtKKiet 


ISS-V 


4^ 


^ 


CIHM/ICMH 

Microfiche 

Series. 


CIHM/iCIVIH 
Collection  de 
microfiches. 


Canadian  Institute  for  Historical  ly/licroreproductions  /  Institut  Canadian  de  microreproductions  historiques 


KittliMiMiaMWHIiBi 


87 


OREGON. 


§  31 


general  iaws,  Id.  §  2.  Stockholders  shall  be  liable  on  their  subscrip- 
tions, but  no  farther,  Id.  §  3.  The  state  shall  not  be  interested  in  the 
stock  of  corporations,  Id.  §  6.  Municipalities  shall  not  aid  or  be  in- 
terested in  corporations,  Id.  §  9. 

Miscellaneons  Corporations. — Three  or  more  persons  may  incorporate 
for  any  lawful  enterprise,  business,  pursuit  or  occupation,  Gen.   Stat, 
1887,  §  3217.     The  incoriwrators  need  not  be  stockholders.     Railroads 
are  incorporated  hereunder,  Id.  notes.     Articles  are  to  be  filed  with  the 
secretary  of  state   and   county  clerk,    §  3218.     May  hold  real   estate 
necessary  and  convenient  and   to  aid  the  objects  of  the   corporation. 
May  make  a  by-law  for  the  sale,  without  judgment  or  execution,  but  on 
thirty  days'  notice,   of  delinquent   stock.     Railroad  corporation   may 
lease,  purchase  or  operate  other  lines  not  competing,  §  3221.     Each 
share  is  entitled  to  one  vote,  but  after  the  first  election  shares  shall  not 
be  voted  unless  all  installments  due  are  paid,  §  3223.     Directors  must 
be  stockholders  and  residents  and  must  take  an  oath;  but  corporations 
"  incorporated  for  the  purpose  of  constructing  railroads,  or  military 
wagon  roads,  canals  or  flumes,  or  carrying  on  mining  enterprises  withir* 
or  without  the  state,  or  publishing  newspapers  or  conducting  institutions 
of  learning  in  this  state,  may  permit  a  minority  of  the  board  of  directors- 
to  reside  out  of  this  state,"  §  3224.     The  stock  book  is  to  be  kept  open 
to  inspection,  §3228.     Stock  is  subject  to  attachment  and   execution,. 
§  3229.     The  assignee  of  unpaid  stock  is  liable  for  any  unpaid  balance 
thereon,  but  the  seller  is  still   liable  to  existing  creditor  for  the   said 
balance  if  the  buyer  does  not  pay,  §  3230.  Directors  are  made  personally 
liable  in  case  of  their  wrongdoing,  §  3231.     Corporations  must  organize 
within  one  year.     Non-user  for  six  months  thereafter  is  fatal,  §  3232. 
A  majority  stock  vote  may  increase  or  diminish  the  capital  or  dissolve 
the  corporation,  §  3235.     Directors  may  file  supplementary  articles  to 
engage  in  a  cognate  business  upon  the  consent  of  three-fourths  of  the 
stock,  or  to  engage   in  a  new  enterprise  upon  the  consent  of  seven- 
eighths  of  the  stock,  §  3238.     Foreign  corporations  for  fire  and  marine 
insurance,  brokerage  and  express  business  must  give  six  months'  public 
notice  of  their  intention  to  cease  business,  §  3273.    They  must  file  a. 
designation  of  an  attorney,  a  resident  citizen  of  state  and  the  United 
States  to  accept  service  before  doing  business,  §§  3276,  .3277.     Andl 
must  deposit  $50,000  with  the  state  treasurer  as  security  for  claims  and 
demands  of  persons  doing  business  with  such  companies  in  the  state,. 
§  3568.     Any  surety  company  with  paid-up  capital  of  $500,000  may 
transact  business  in  the  state  upon  compliance  with  these  conditions,, 
§  3279.     Foreign  life  insurance  companies  shall  pay  $100  annually  to- 
the  state  treasurer,   §  3290.     Foreign  railroad  corporations  leasing  ai 


§  32 


PENNSYLVANIA. 


88 


«? 


domestic  railroad  must  execute  an  agreement  with  the  state  of  Oregon 
that  all  suits  of  such  lessor  with  citizens  of  Oregon  shall  be  carried  to 
final  determination  in  the  courts  of  the  state  or  in  the  federal  courts; 
and  the  state  reserves  the  right  to  regulate  rates  on  such  leased  lines 
and  make  proper  police  regulations,  §  3293. 

Taxation. — Personal  property  of  private  corporations  is  assessed  and 
taxed  in  the  county  where  the  principal  office  is  located.  The  rolling  stock 
of  railroads  is  assessed  in  the  county  of  the  principal  terminus  or  depot, 
except  where  one  terminus  or  any  depot  is  in  the  same  county  as  the  prin- 
cipal office.  The  personal  property  of  any  corporation  may  be  sold  for  any 
tax,  §  2744.  Railroad  companies  must  have  a  principal  office  in  the  state, 
§  2745.  A  railroad  agent  must  furnish  a  sworn  statement  of  all  property, 
and  this  is  then  apportioned  to  the  several  counties,  §  2746.  Stock  is 
•not  taxed  to  the  owner  where  the  capital  is  taxed  against  the  company* 
■§  2750.  The  real  estate  of  corporations  is  assessed  in  the  county  where 
it  lies,  like  that  of  individuals,  §  2739.  Shares  of  banks  located  in  the 
state  are  taxed  against  the  owners  where  they  reside.  Non-resident 
owners  are  taxed  on  their  shares  at  the  place  where  the  bank  is  and  the 
tax  is  a  lien  upon  such  shares,  §  2734.  The  fees  of  the  secretary  of 
state  for  filing  articles  of  incorporation  are  #2.50,  |  2337.  Shares  of 
stock  are  taxed;  also  such  part  of  the  capital  stock  as  is  liable  to  taxa- 
tion and  is  not  invested  in  real  estate,  Id.  §  2731. 

<§  ^.  PENNSTLTANIA.  Constitnttonal  Provisions.— The  constitu- 
itional  provisions  of  this  state,  relative  to  corporations,  may  well  serve  as 
models  for  other  states.  On  account  of  this  transcendent  merit,  they  are 
given  at  some  length.  No  local  or  special  law  shall  create  corporations, 
•or  grant  to  them  any  special  or  exclusive  privilege  or  immunity,  or  to 
Kjorporations  the  right  to  lay  down  a  railroad  track,  Art.  III.,  §  7.  The 
general  assembly  shall  not  authorize  guardians,  executors,  trustees,  etc., 
to  invest  trust  funds  in  stock  or  bonds  of  private  corporations.  Art.  III., 
§22.  Exemptions  from  taxation,  with  certain  exceptions,  are  void,  Art. 
IX.,  2.  "The  credit  of  the  commonwealth  shall  not  be  pledged  or 
loaned  to  any  individual,  company,  corporation  or  association;  nor  shall 
the  commonwealth  become  a  joint  owner  or  stockholder  in   any  com- 


pany,    association    or    corporation,"  Art.  IX. 


The  general 


assembly  shall  not  authorize  any  county,  city,  borough,  township  or 
incorporated  district  to  become  a  stockholder  in  any  company,  asso- 
ciation or  corporation,  or  to  obtain  or  appropriate  money  for,  or  to  loan 
its  credit  to  any  corporation,  association,  institution  or  individual,"  Art. 
IX.,  §  7.  "All  existing  charters,  or  grants  of  special  or  exclusive  priv- 
ileges, under  which  a  bona  fide  organization  shall  not  have  taken  placet 


88 

the  state  of  Oregon 
1  shall  be  carried  to 
the  federal  courts; 
1  such  leased  lines 

ions  is  assessed  and 
1.  The  rolling  stock 

1  terminus  or  depot, 

2  county  as  the  prin- 
may  be  sold  for  any 

)al  office  in  the  state, 
ment  of  all  property, 
i,  §  2746.  Stock  is 
linst  the  company* 
,n  the  county  where 
anks  located  in  the 
!side.  Non-resident 
the  bank  is  and  the 
of  the  secretary  of 
I  2337.  Shares  of 
as  is  liable  to  taxa- 


ons.— The  constitu- 
is,  may  well  serve  as 
ndent  merit,  they  are 
create  corporations, 
or  immunity,  or  to 
Art.  III.,  §  7.  The 
cutors,  trustees,  etc., 
rporations,  Art.  III., 
ttions,  are  void,  Art. 
not  be  pledged  or 
issociation;  nor  shall 
lolder  in  any  com- 
I  6.  "  The  general 
rough,  township  or 
any  company,  asso- 
noney  for,  or  to  loan 
or  individual,"  Art. 
al  or  exclusive  priv- 
)t  have  taken  place, 


89 


PENNSYLVANIA. 


83 


and  business  have  commenced  in  good  faith,  at  the  time  of  the  adoption 
of  this  constitution,  shall  thereafter  have  no  validity,"  Art.  XVI.,  §  i. 
"In  all  elections  for  directors  or  managers  of  a  corporation,  each  mem- 
ber or  shareholder  may  cast  the  whole  number  of  his  votes  for  one 
candidate,  or  distribute  them  upon  two  or  more  candidates  as  he  may 
prefer,"  Art.  XVI.,  §  4.1  "  No  corporation  shall  engage  in  any  business 
other  than  that  expressly  authorized  in  its  charter;'  nor  shall  it  take  or 
hold  any  real  estate,  except  such  as  may  be  necessary  and  proper  for 
its  legitimate  business,"  Art.  XVI.,  §  6.  "  No  foreign  corporations  shall 
do  any  business  in  this  state  without  having  one  or  more  known  places 
of  business,  and  an  authorized  agent  or  agents  in  the  same,  upon  whom 
process  may  be  served,"  Art.  XVI.,  §  5.*  "  No  corporation  shall  issue 
stocks  or  bonds  except  for  money,  labor  done,  or  money  or  property 
actually  received;  ani  all  fictitious  increase  of  stock  or  indebtedness 
shall  be  void.^  The  stock  and  indebtedness  of  corporations  shall  not 
be  increased  except  in  pursuance  of  general  law,  nor  without  the  con- 
sent of  the  persons  holding  the  larger  amount  in  value  of  the  stock  first 
obtained,  at  a  meeting  to  be  held  after  sixty  days'  notice  given  in  pursu- 
ance of  law,"  Art.  XVI.,  §  7.  The  right  to  alter,  revoke  or  annul  charters  is 
reserved,  Art.  XVI.,  §  10.  Consolidation,  etc.,  of  competing  telegraph 
lines  are  prohibited.  Art.  XVI.,  §  12.  The  transfer  book  and  the  names 
and  amount  of  stock  owned  by  stockholders  shall  be  open  to  the  inspec- 
tion of  stockholders  and  corporate  creditors,  Art.  XVII.,  §  2."  "  No 
railroad,  canal  or  other  corporation,  or  the  lessees,  purchasers  or  man- 
agers of  any  railroad  or  canal  corporation  shall  consolidate  the  stock, 
property  or  franchises  of  such  corporation  with,  or  lease,  or  purchase 
the  works  or  franchises  of,  or  in  any  way  control,  any  other  railroad  or 
canal  corporation,  owning  or  having  under  its  control,  a  parallel  or 
competing  line;  nor  shall  any  officer  of  such  railroad  or  canal  corpora- 
tion act  as  an  officer  of  any  other  railroad  or  canal  corporation,  owning 
or  having  the  control  of  a  parallel  or  competing  line;  and  the  question 
whether  railroads  or  canals  are  parallel  or  competing  lines,  shall,  when 
demanded  by  the  party  complainant,  be  decided  by  a  jury,  as  in  other 
civil  issues,"  Art.  XVII.,  §  4.*  Common  carriers  shall  not  engage  in 
manufacturing  or  mining,  nor  in  any  other  business.  But  mining  and 
manufacturing  companies  may  have  a  railroad  or  canal  not  over  fifty 
miles  in  length,  Art.  XVII.,  §5.  "No  president,  director,  officers, 
agent  or  employe  of  any  railroad  or  tanal  company  shall  be  interested, 
directly  or  indirectly,  in  the  furnishing  of  material  or  supplies  to  such 

'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxvii. 
*/(/.,  chapter  xl.  */</.,  chapter  xli.  V</.,  chapter  Hi. 

*Id.,  chapter  xxx.  *Id. ,  chapter  xix.  and  xl. 


8  32 


PENNSYLVANIA 


9a 


company,  or  in  the  business  of  transportation  as  a  common  carrier  of 
freight  or  passengers  over  the  work  owned,  leased,  controlled  or  worked 
by  such  company,"  Art.  XVII.,  §  6.^  "No  railroad,  railway  or  other 
transportation  company  shall  grant  free  passes,  or  passes  at  a  diccount, 
to  any  person  except   officers   or   employes  of  the    company,"  Art. 

XVII.,  §  8. 

Miscellaneous  Corporations.— May  be  formed   for  various  purposes 
specified  in  the  statute,  including  the  buying  and  selling  of  real  estate. 
See  Brightley's  Purdon's  Digest,  1883,  pp.  335,  etc.»    Incorporators  to  be 
five  or  more,  three  of  whom,  at  least,  must  be  residents,  p.  337.     The 
certificate  must  state  that  ten  per  cent  of  the  capital  stock  has  been  paid 
in  cash.     The  certificate  must  be  approved  by  the  governor  in  case  of 
business  corporations;  by  county  judge  in  other  cases.    The  charter 
may  be  perpetual,  subject  to  repeal.   A  fee  of  $5  \fi  charged  by  the  secre- 
tary of  the  commonwealth  for    receiving  the  certificate.  Id.  p.  338. 
Corporations  must  register  with  the  auditor  general  under  a  penalty  of 
$500,  p.  338,  §  12.     The  charter  may  be  amended  on  the  approval  of  the 
same  persons  that  approved  of  the  charter,  p.  340.     By-laws  shall  be 
made  by  the  stockholders  unless  the  charter  prescribes  otherwise.  Trans- 
fers of  stock  subject  both  the  transferer  and  transferee  to  liability  for 
the  unpaid  subscription,  p.  341.     Invalid  elections  may  be  set  aside  by 
the  courts.     The  capital  stock  is  limited  to  $1,000,000,  p.  342.     Cumu- 
lative voting  is  to  prevail,  p.  342'»  §28.'    Notes  or  obligations  by  the 
stockholder    shall    not    be    held    to    be    payment     of    subscription. 
Corporations    shall    not    purchase    the    stock     of    other    corpora- 
tions.*   Preferred  stock  may  be  issued  on  a  majority  vote  of  the  stock- 
holders.    Stock  may  be  issued  for  property.     Deferred  stock  may  be 
issued  to  receive  dividends  after  the  dividends  on  all  other  stock,  p.  343. 
An  increase  of  indebtedness  is  legal  only  upon  a  majority  .vote  of  the 
stockholders."     May  borrow  and  give  mortgage  for  an  amount  not  over 
half  of  the  capital  stock  paid  in,  unless  otherwise  provided,  p.  344.* 
Amended  so  as  to  allow  certain  corporations  to  issue  bonds  to  double 
the  amount  of  their  paid-in  capital,  L.  1889,  p.  237.     Stockholders  are 
liable  "to  the  amount  of  stock  held  by  each  of  them"  for  work  or  labor 
done  for  the  corporation.'    An  action  to  enforce  this  liability  may  be  at 
law  or  in  equity,  against  one  or  more  stockholders,  Brightley's  Purdon's 
Digest,  p.  345.     Suit  must  be  brought  within  six  months  after  the  claim 
is  due,  p.  346.     The  capital  stock  of  corporations  for  dealing  in  real 
estate  is  limited  to  $600,000,  p.  347-     Annual  elections  of  officers  must 

•Cook   on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxix. 
'/(/.,  chapter  xU'.  */</.,  chapter  xxxvH.  */</.,  chapter  xix. 

»/(/.,  chapter  x!l  */ti.,  chapter  xli.  Vrf.,  chapter  xii. 


— ,>S  'S-^J"-'- ' 


90 


91 


PENNSYLVANIA. 


32 


common  carrier  of 
:ontrolled  or  worked 
id,  railway  or  other 
lasses  at  a  di.>count^ 
he    company,"  Art. 

or  various  purposes 
lling  of  real  estate. 

Incorporators  to  be  . 
iidents,  p,  337.     The 
1  stock  has  been  paid 
governor  in  case  of 

cases.  The  charter 
charged  by  the  secre- 
rtihcate,  Id.  p.  338. 

under  a  penalty  of 
on  the  approval  of  the 
o.  By-laws  shall  be 
jes  otherwise.  Trans- 
iferee  to  liability  for 
may  be  set  aside  by 
,000,  p.  342.  Cumu- 
or  obligations  by  the 
int    of    subscription, 

of    other    corpora- 
ity  vote  of  the  stock- 
ferred  stock  may  be 
ill  other  stock,  p.  343^ 
majority  .vote  of  the 
r  an  amount  not  over 
irise  provided,  p.  344.* 
isue  bonds  to  double 
7.     Stockholders  are 
!m"  for  work  or  labor 
his  liability  may  be  at 
i,  Brightley's  Purdon's 
months  after  the  claim 
s  for  dealing  in  real 
Dtions  of  officers  must 

ition  Law,  chapter  xxxix. 
*Id.,  chapter  xix. 
'/</.,  chapter  xii. 


be  held  in  the  state,  but  other  stockholders'  meetings  and  directors' 
meetings  may  be  held  out  of  the  state  if  a  majority  of  the  stockholders 
or  directors  reside  out  of  the  state,  p.  352.  May  invest  surplus  earnings 
in  its  own  stock.  A  majority  of  the  directors  and  officers  must  be  resi- 
dents »  of  the  state.  They  may  vary  in  number  from  five  to  fifteen,  p. 
353.  Foreign  corporations,  before  doing  business  in  the  state,  must  file 
a  certificate  and  designate  an  agent.*  I'enalty  exists  for  not  so  doing. 
Foreign  corporations  shall  not  hold  real  estate  in  the  state,  absolutely 
or  by  a  trustee,  unless  specially  authorized  by  the  state  so  to  do.'  But 
certain  manufacturing  corporations  may  hold  100  acres  of  land,  p.  361. 
Foreign  corporations  may  incorporate  under  the  laws  of  the  state  upon 
renouncing  their  foreign  charter,  p.  362.  Iron  manufacturing  compa 
nies  are  not  limited  as  to  the  quantity  of  land  they  may  hold.  Id.  Suppm't»- 
p.  2225,  Act  May  24,  1887.  Stock  is  personal  property  and  not  trans- 
ferable until  all  previous  calls  are  fully  paid.  Funds  are  not  to  be  in- 
vested  in  the  stock  of  other  corporations  except  to  secure  debts.  Act 
May  25, 1887,  Brightley's  Purdon's  Digest,  Suppm't,  2173.  Other  corpo- 
rations may  hold  the  stock  and  bonds  of  iron  and  steel  companies,  and 
vice  versa',  but  no  corporation  can  hold  a  majority  of  the  stock  of  a 
railroad  or  other  common  carrier.  Act  June  17,  1887,  Brightley's  Pur- 
don's Digest,  Suppm't,  2173,  2174.  Foreign  corporations  doing  business 
in  the  state  may  purchase  real  estate  at  a  judicial  sale,  but  must  sell 
and  convey  it  within  ten  years,  Act  May  23,  1887,  Brightley's  Purdon's- 
Digest,  Suppm't,  2174.  As  to  sale  of  franchises,  see  Brightley's  Purdon's. 
Digest,  Suppm't,  2174,  2175.  The  real  owner  of  stock  is  to  be  allowed 
to  vote  it  either  in  person  or  by  proxy,  L.  1889,  No.  108.  Foreign 
corporations  doing  business  in  the  state  must  file  a  certificate  under  a 
penalty  of  $500,  L.  1889,  No.  332. 

Other  Mlgoellaneoos  Corporations. — The  general  corporation  laws  do- 
not  provide  for  mercantile  corporations,  but  these  are  practically  incor- 
porated by  means  of  "partnership  associations"  under  the  Act  of  June 
2,  1874.  They  are  a  kind  of  joint  stock  companies,  and  have  been  sa 
developed  by  use  and  later  acts  that  they  are  now  essentially  corpora- 
tions. Three  or  more  persons  may  form  an  association  to  conduct  any 
lawful  business  within  the  United  States  or  elsewhere.  The  principal 
office  shall  be  in  this  state.  The  capital  shall  alone  be  liable  for  debts, 
of  such  associations.  A  statement  of  certain  essential  facts  is  to  be 
signed,  acknowledged  and  recorded  in  the  county.  The  duration  may 
be  twenty  years.  The  liability  of-members  is  for  unpaid  subscriptions- 
only,  unless  the  word  "limited"  is  omitted  from  the  association  name,. 

•Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxvit.. 
*Id.,  chapter  xli.  '/</. 


%  82 


PENNSYLVANIA. 


92 


'Mi- 


in  which  case  they  are  individually  liable.  There  shall  be  from  three  to 
seven  managers  elected  at  annual  meetings.  The  association  is  not 
boimd  by  any  liability  over  $500  unless  it  is  reduced  to  writing  and 
signed  by  two  managers.  The  credit  and  capital  are  not  to  be  loaned 
to  any  member  nor  to  any  other  person  or  association  without  the  writ- 
ten consent  of  a  majority  of  its  members  in  number  and  value.*  The 
capital  may  be  paid  in  real  or  personal  property,  Brightley's  Purdon's 
Digest,  pp.  937,  939,  see  Van  Horn  v.  Corcoran,  18  Atl.  Rep.  16,  Pa- 
1889.  By  Act  of  June  25,  1885,  stock  in  such  partnership  associations 
(which  must  be  distinguished  from  limited  partnerships  proper  provided 
for  in  Act  of  1836,  see  Brightley's  Purdon's  Digest,  pp.  1070  etsef.)vire 
declared  personal  property  capable  of  transfer,  but  not  entitling  the 
transferee  to  membership  except  upon  the  consent  of  a  majority  of  the 
members  in  number  and  value.  When  not  accepted  the  transferee  is 
paid  the  value  of  his  interest  at  the  time  of  the  transfer,  Brightley,  Suppm't, 
p.  2228.  The  salaries  of  the  president,  secretary  and  treasurer,  after 
five  years,  shall  not  exceed  the  profits  of  the  preceding  year  unless  two- 
thirds  of  the  stockholders  consent,  L.  1889,  No.  208. 

Railroiid  Corporations. — At  annual  meetings  the  stockholders  may 
perform  any  corporate  act.  Special  meetings  are  to  be  called  by  the 
president  on  the  request  of  one-tenth  in  interest  of  the  stock.  The 
president  and  directors  are  to  exercise  the  corporate  powers.  Act  June 
25,  1885,  Brightley's  Purdon's  Digest,  Suppm't,  p.  2377.  Nine  or  more 
citizens  of  the  state  may  incorporate  a  railroad  company,  Brightley's  Pur- 
don's Digest,  1883,  p.  1414.  At  the  time  of  subscribing,  ten  per  cent  in 
money  is  to  be  paid  in.  A  majority  of  the  directors  [six  to  twelve]  must  be 
citizens  of  the  state.  Id.  p.  1415.'  The  articles  must  be  subscribed,  ac- 
knowledged and  filed  with  the  affidavits  of  at  least  three  directors  that  the 
required  amount  of  stock  has  been  subscribed  and  one-tenth  actually  paid 
in,  Id.  pp.  1414,  1415.  The  president  and  directors  may  borrow  money 
.and  issue  bonds  not  exceeding  the  capital  stock,  nor  double  the  paid- 
up  capital,  'p.  1416.  The  issuance  of  stock  for  money,  except  at  par 
value*  paid  in  cash  is  forbidden,  and  the  issuance  for  labor  done  or 
property  received  is  strictly  limited  and  prescribed.  Bonds,  etc.,  are 
not  to  issue  until  the  full  capital  stock  is  paid  in,  nor  for  less  than  the 
fair  market  value.  Act  May  7, 1887,  Brightley's  Purdon's  Digest,  Suppm't, 
p.  2378.  Five  dollars  per  share  is  to  be  paid  to  the  commissioners  at  the 
time  of  subscribing,  in  addition  to  the  ten- per  cent,  Id.  supra,  p.  141 7.  The 
president  must  be  a  resident  of  the  state,  p.   1418.'    Shares  transferred 

'  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,   chapter  xH. 
VfiT,,  chapter  xxxvii.  •/</.,  chapter  xU.  V</.,  chapter  iii. 

•/</. ,  chapter  xxxvii. 


92 

ihall  be  from  three  to 
e  association  is  not 
duced  to  writing  and 
re  not  to  be  loaned 
on  without  the  writ- 
er and  value.*  The 
Brightley's  Purdon's 
i8  Atl.  Rep.  i6,  Pa- 
tnership  associations 
hips  proper  provided 
,  pp.  loyo  efse^.)are 
)ut  not  entitling  the 
of  a  majority  of  the 
ted  the  transferee  is 
•,  Brightley,  Suppm't, 
and  treasurer,  after 
ding  year  unless  two- 
>8. 

e  stockholders  may 
to  be  called  by  the 
of  the  stock.  The 
Lte  powers.  Act  June 
2377.  Nine  or  more 
any,  Brightley's  Pur- 
ibing,  ten  per  cent  in 
six  to  twelve]  must  be 
ist  be  subscribed,  ac- 
iree  directors  that  the 
le-tenth  actually  paid 
s  may  borrow  money 
lor  double  the  paid- 
joney,  except  at  par 
;  for  labor  done  or 
i.  Bonds,  etc.,  are 
or  for  less  than  the 
Ion's  Digest,  Suppm't, 
commissioners  at  the 
d.  supra,  p.  1417.  The 
Shares  transferred 

ation  Law,   chapter  xli. 
*/d.,  chapter  iii. 


98 


PENNSYLVANIA. 


8  3a 


within  sixty  days  preceding  an  election  give  no  vote  to  the  holder.  The 
transferer  and  transferee  of  stock  are  liable  for  unpaid  subscriptions, 
p.  14.19.  Stockholders  in  arrears  cannot  vote.  Forfeiture  of  stock 
does  not  relieve  the  stockholder  from  the  liability.  At  annual  meet- 
ings the  officers  must  make  reports.  The  state  may  revoke  a  charter 
and  take  the  road  for  its  own  use  on  payment  of  compensation  to  the 
stockholders,  p.  1420.  Railroads  and  canal  companies  must  maintain 
an  office  within  the  state  with  stock  books,  etc.,  p.  1421.  May  execute 
mortgages  to  secure  their  bonds,  p.  1422.  A  railroad  may  purchase  a 
connecting  line  at  a  foreclosure  sale,  p.  1422.  Connecting  lines  may 
consolidate,  p.  1429.  A  majority  may  effect  the  consolidation,  but  the 
dissenting  stockholders  must  be  paid  the  actual  market  value  of  their 
stock,  p.  1430.  In  case  a  stockholder  objects  to  a  consolidation  he 
may  apply  to  a  court,  have  the  ivalue  of  his  stock  appraised  and  com- 
pel payment  from  the  company,  Id.  A  majority  of  the  directors  and 
the  president  must  be  residents.  Elections  must  be  held  in  the  state. 
Id.  p.  1437.  Every  railroad  must  make  an  annual  report  on  its  affairs 
to  the  auditor  general.  Id.  p.  1438.  A  railroad  may  own  stocks  and 
bonds  of  other  railroads  and  may  lease  them.  May  guarantee  bonds  of 
other  lines.  May  lease  other  lines.  Id.  p.  1439,  1441.  The  real  owner 
of  stock  is  to  be  allowed  to  vote  it  either  in  person  or  by  proxy,  L.  1889, 
No.  108. 

Issue  of  stock  and  bonds  upon  a  consolidation  of  rai'roads  regulated, 
L.  1889,  No,  223. 

Foreign  corporations  doing  business  in  the  state  must  file  a  certificate 
under  a  penalty  of  $500,  L.  1889,  No.  332. 

Street  railroad  act,  L.  1889,  No,  227. 

Banks. — Banking  companies  may  be  incorporated  by  three  or  more. 
Notice  of  application  must  be  published  for  three  months.  Articles  to 
be  approved  by  the  attorney  general  and  filed  with  the  certificate  with  the 
auditor  general.  Letters  patent  then  issue.  The  capital  stock  must  be 
not  less'than  $50,000,  Stockholders'  liability  is  for  the  amount  of  their 
stock  at  par  in  addition  to  the  par  value  thereof.  Before  commencing 
business  fifty  per  cent  of  the  capital  must  be  paid  in  and  thereafter  ten 
percent  per  month.  Every  one  of  (at  least  five)  directors  must  be 
citizens  of  the  United  States  and  of  Pennsylvania  and  must  hold  at 
least  ten  shares  of  stock.  Loans  to  a  director  must  not  exceed  ten 
per  cent  of  the  capital  stock  paid  in.  Gross  loans  to  all  officers  must 
not  exceed  twenty-five  per  cent  of  the  same.  The  bank  has  a  lien  on 
shares  for  all  dues.  No  loans  to  be  made  on  stock.  The  bank  must 
not  hold  its  own  stock  except  to  secure  debts.  Not  to  pay  interest  on 
call  deposits,  Act  of  13th  May,  1876.     The  last  mentioned  act  re- 


1} 


8  32 


PENNSYLVANIA, 


94 


peals  everything  inconsistent  therewith  Under  the  acts  existing  at 
that  time  (1876)  were  the  following  provisions  :  No  person  shall  be 
tlirector  of  any  two  banks  at  the  same  time,  nor  shall  the  gover- 
nor, the  executive  or  judicial  officers  of  the  state,  or  city  or 
county  treasurers,  or  members  of  state  legislature,  b';  directors, 
Brightley's  Purdon's  Digest,  1883,  p.  160.  No  person  shall  be 
director  more  than  three  years  out  of  four,  except  the  president. 
Id.  p.  161.  Officers  cannot  vote  proxies.  Cashiers  cannot  engage 
in  other  occupations.  Id.  p.  162.  Books,  etc,  must  always  be 
open  to  directors  and  open  to  stockholders  at  general  meetings, 
Id.  p.  164.  The  total  liabilities  shall  not  exceed  three  times  the 
capital  stock.  Id.  p.  17a.     Savings  bank,  L.   1889,  No.  236. 

Taxation. — Miscellaneous  corporations,  including  manufacturing 
and  mining  corporations,  must  pay  to  the  state  for  the  charter  one-fourth 
of  one  per  cent  of  the  capital  stock,  one-half  to  be  paid  upon  incorpora- 
tion, one-half  a  year  after,  Brightley's  Purdon's  Digest,  1883,  p.  35 1,  §  74. 
The  same  tax  is  paid  upon  any  increase  of  the  capital  stock,  L.  1889,  No. 
J  25.  "Public  loans  or  stocks"  are  taxable  for  state  purposes  three  mills  on 
the  dollar.  Banks  and  simitar  corporations  may  pay  six  mills  on  the 
dollar  uf  the  par  value  of  all  stock  and  then  be  exempt  from  all  other 
taxes,  except  on  land.  The  corporate  treasurer  paying  interest  to 
resident  holders  of  corporate  scrip,  bonds  or  certificates  of  indebtedness 
must  deduct  three  mills  on  the  dollar  and  pay  it  to  the  state.  The  bank 
stock  is  assessed  against  resident  holders  at  the  place  where  they  reside, 
in  case  the  banks  do  not  elect  to  pay  six  mills  as  supra.  Manufacturing 
corporations  are  exempt  from  taxation,  except  those  manufacturing  gas 
or  liquor.  Act  June  30,  1885,  Id.  Suppm't,  pp.  2398  et  seq.  Mutual 
loan  and  building  associations  are  exempt  from  the  state  tax.  Act  May 
32,  1883.  Corporate  loans  and  stocks  guaranteed  by  the  state  shall  pay 
a  tax,  the  amount  of  which  shall  be  retained  by  the  state  and  deducted 
from  the  payment  of  interest,  Id.  supra  p.  1611,  §  178.  Taxes  on  the 
capital  stock  are  paid  by  the  corporation  and  deducted  from  dividends, 
or  the  stock  may  be  sold.  If  the  tax  is  not  duly  paid  the  directors 
become  personally  liable,  p.  161 1,  §  181.  All  taxes  are  a  lien  and  are 
paid  first  on  a  judicial  sale,  p.  1620,  §  213.  Domestic  insurance  com- 
panies are  taxed  eight-tenths  of  one  per  cent  upon  the  gross  amount  of 
premiums,  p.  1618,  §  208.  A  tax  of  three  per  cent  on  the  annual  net 
earnings  or  income  is  also  levied  against  certain  banks  for  the  use  of 
the  state.  State  banks  shall  pay  a  tax  of  one  per  cent  on  the  par 
value  of  all  shares  of  stock ;  the  latter  are  then  exempt  from  all 
other  taxes,  p.  161 2.  A  statement  of  the  corporate  assets,  copy  of  in- 
corporating act,  etc.,   must,  be  registered    in   the   auditor  general's 


.t 


H 

,\ie  acts  existing  at 
No  person  shall  be 
)r  shall  the  gover- 
!  state,  or  city  or 
iture,  l)*?  directors, 
lo  person  shall  be 
xcept  the  president, 
hiers  cannot  engage 
;.,  must  always  be 
t  general  meetings, 
eed   three  times  the 

No.  236. 
ding    manufacturing 
he  charter  one-fourth 
paid  upon  incorpora- 

ist,  1883,  p.  351,8  74- 
,1  stock,  L.  1889,  No. 
urposes  three  mills  on 
pay  six  mills  on  the 
;empt  from  all  other 
ir  paying  interest  to 
cates  of  indebtedness 
1  the  state.  The  bank 
ice  where  they  reside, 
fra.  Manufacturing 
se  manufacturing  gas 
198  gt  seq.  Mutual 
e  state  tax,  Act  May 
by  the  state  shall  pay 
e  state  and  deducted 
178.  Taxes  on  the 
icted  from  dividends, 
ly  paid  the  directors 
[es  are  a  lien  and  are 
estic  insurance  com- 
the  gross  amount  of 
It  on  the  annual  net 
Ijanks  for  the  use  of 
per  cent  on  the  par 
n  exempt  from  all 
ite  assets,  copy  of  in- 
he   auditor  general's 


95 


RHODR    ISLAND, 


8  38 


office  before  beginning  operations,  under  a  penalty  of  $500,  p.  1615. 
A  tax  of  one-half  mill  for  each  one  per  cent  of  dividend  declared  is 
levied  on  the  capital  stock  of  all  domestic  and  foreign  corporations 
if  they  declare  a  six  per  cent  dividend  or  over.  If  under  six  per  cent, 
then  a  three  mill  tax  is  levied  on  the  actual  value  of  the  capital 
stock,  p.  1616,  8  204.  Manufacturing  corporations  manufacturing  within 
the  state  are  exempt  from  this  particular  tax,  L.  1889,  No.  332,  §  21. 
Certain  transportation  and  other  quasi  public  corporations  pay  a  tax 
also  of  eight  mills  on  every  dollar  of  gross  receipts  on  business  wholly 
Vithin  the  state,  Id.  Formerly  banks  paid  a  tax  of  a  percentage  of 
the  dividends,  nmningfrom  eight  percent  on  six  per  cent  dividends  to 
thirty  per  cent  on  dividends  over  twenty-five  per  cent,  p.  173, 
Acts  1850,  1867.  National  bank  stock  is  to  be  assessed  at 
its  actual  value.  Stock  may  be  sold  by  attachment  or  by  levy 
and  sale  for  non-payment  of  tax.  Bank  cashiers  shall  pay  a  tax 
of  one  per  cent  on  the  par  value  of  all  shares  of  stock,  thereby  exempt- 
ing the  shares  from  all  other  tax.  National  bank  shares  shall  pay  the 
state  a  three  mill  tax  on  their  actual  value  and  pay  also  a  local  ta.x,  pp. 
^73-^74'  Shares  of  stock  are  taxed  unless  the  corporation  is  subject 
to  a  tax  on  its  capital,  L.  1889,  No.  332,  §  i.  Banks  may  pay  a  six 
mdl  tax  in  lieu  of  other  local  taxation,  outside  of  the  tax  on  real  estate. 
They  also  pay  a  three  mill  tax  to  the  state,  §§  25,  26.  In  addition  to 
the  tax  levied  under  Section  I.  of  this  act,  a  three  per  cent  tax  is  levied 
on  the  annual  "  net  earnings  or  income,"  §  27. 

§  33.  RHODE  ISLAND.  Constitutional  ProTlsions—Any  special  act 
creating  a  corporation  other  than  one  for  religious,  literary,  charitable, 
military  or  fire  purposes  must  be  introduced  into  the  legislature  and  then 
wait  until  a  subsequent  election  of  members  takes  place  before  it  is 
passed,  public  notice  being  given  of  its  pendency,  Art.  IV.,  817. 

Jllsoellaneoas  Corporations — There  seems  to  be  no  general  act  for 
the  incorporation  of  such  companies.  The  stockholders  are  jointly  and 
severally  liable  for  all  debts  until  the  capital  stock  is  fully  paid  up  and 
a  certificate  to  that  effect  filed  with  the  town  clerk,  Pub.  Stat.  1882,  p. 
386.  Officers  not  filing  such  certificate  within  ten  days  after  the  cajn- 
tal  stock  is  paid  up  are  liable  for  all  corporate  debts  contracted  there- 
after and  before  the  certificate  is  filed,  Id.  Stock  cannot  be  paid  for  by 
the  stockholder's  note  or  obligation.  Officers  are  liable  for  loans  to 
stockholders,  p.  387.  Stock  issued  for  real  estate  and  machinery  shall 
equal  in  its  par  value  the  value  of  the  latter  as  valued  by  the  tax  asses- 
sor. Id.  An  annual  report  must  be  filed  with  the  town  clerk,  p.  388.  If 
xhe  report  is  not  filed,  /the  stockholders  are  liable  for  corporate  debts  to 


r 
'{I 


El 

J 


li 


'.i-  * 


I! 


83 


RHODE    IHLAND. 


96 


the  extent  of  the  par  value  of  the  stock  in  addition  to  the  unpaid  sub- 
scription, Id.  Stoci<holder  may  avoid  this  liability  by  filing  a  sworn 
report  or  an  affidavit  that  he  cannot  give  it;  ihat  he  has  requested  officer* 
to  make  report  and  that  they  have  not  so  made  it,  Id.  Corjiorate  debt* 
are  not  to  exceed  the  paid-up  capital  stock.  Officers  are  liable  for  ex- 
cess of  debt,  Id.  Officers  knowingly  signing  false  certificates  or  reiwrta 
are  liable  for  corporate  debts,  p.  389. 

Railroad  Corporations.— There  seems  to  be  no  general  act  for  incor- 
poration. Stockholders  may  "  at  all  reasonable  times  examine  the  books, 
papers  and  accounts  of  the  corporation,"  Id.  p.  408.  Railroads  built 
without  a  charter  or  license  from  the  general  assembly  are  a  public 
nuisance,  p.  409. 

Banks.— Stockholders  are  liable  for  corporate  debts  to  the  extent  of 
the  par  value  of  their  stock  in  addition  to  the  amount  invested  therein, 
I^-  P*  373>  §  9-  One-third  in  interest  of  the  stockholders  may  call  a  cor- 
porate meeting,  p.  374,  §  13.  Directors  must  be  stockholders,  citizens  and 
residents.  Id.  g  16.  A  majority  of  the  stockholders  owning  one-half  of 
the  capital  stock  may  remove  any  or  all  directors  and  elect  others.  Id. 
§  18.  Directors  by  vote  may  remove  any  officer  appointed  by  them.  Id. 
§19.  Stockholders  may  inspect  all  corporate  books  and  accounts  ex- 
cept individual  accounts.  Id.  p.  375.  Savings  banks  shall  not  make  loans 
to  officers.  Id.  p.  379,  §  54.  A  bank  must  not  be  removed  or  an  ag»-:icy 
established  elsewhere,  Id.  p.  374,  §  11.  Stock  transferred  within  fifteen 
days  of  an  election  cannot  be  voted.  Id.  p.  374,  §  13.  Debts  exclusive 
of  actual  deposits  shall  not  exceed  sixty-five  per  cent  of  the  capital 
actually  paid  in  and  directors  are  liable  for  any  excess,  Id.  p.  375,  §  33. 
Three  or  more  officers,  stockholders  or  creditors  may  require  an  exam- 
ination of  the  bank's  affairs,  Id.  p.  377,  §  39. 

General  ProTisions — Transfer  books  must  be  kept  within  the  state 
and  the  transfer  agent  must  be  a  resident  of  the  state.  Id.  p.  370.  Every 
domestic  corporation  must  have  an  office  and  agent  within  the  state,  Id 
Shares  of  stock  may  be  attached  or  sold  under  levy  of  execution,  Id. 
pp.  573,  616.  By-laws  may  determine  the  number  of  shares  that  shall 
entitle  the  members  to  one  or  more  votes,  Id.  p.  368,  §  3.  Foreign  ex- 
press or  transportation  companies  must  file  a  copy  of  their  charter  and 
make  an  official  designation  of  a  resident  citizen  to  accept  service,  Id. 
P*  337*  Foreign  insurance  companies  must  have  $100,000  capital;  must 
file  a  copy  of  their  charter  and  a  designation  of  a  resident  citizen  to 
accept  service;  and  must  make  special  and  annual  returns  of  the  condi- 
tion of  their  business,  Id.  pp.  400  e/  seq.  Attachments  and  executions 
are  not  to  precede  unregistered  transfers  of  stock,  Laws  1888. 

Taxation.— To  obtain  a  charter  a  fee  is  charged  of  $100  and  also  one- 


99  • 

to  the  unpaid  sub- 
y  by  filing  a  sworn 
las  reqiit'steti  officer* 
d.  Corporate  debt* 
rs  are  liable  for  ex- 
[;ertificate8orreiM)rt» 

eneral  act  for  incor- 
;s  examine  the  booka, 
^o8.  Railroads  built 
isembly  are  a  public 

:bt8  to  the  extent  of 
Lint  invested  therein, 
)lders  may  call  a  cor- 
kholders,  citizens  and 
s  owning  one-half  of 
and  elect  others,  Id. 
ppointed  by  them,  Id. 
ks  and  accounts  ex- 
s  shall  not  make  loans 
emoved  or  an  agency 
isferred  within  fifteen 
13.     Debts  exclusive 
er  cent  of  the  capital 
cess,  Id.  p.  375,  §  2a. 
nay  require  an  exam- 
kept  within  the  state 
,te.  Id.  p.  370.     Every 
Dt  within  the  state,  Id 
levy  of  execution,  Id. 
r  of  shares  that  shall 
j68,  §3.     Foreign  ex- 
r  of  their  charter  and 
to  accept  service,  Id. 
|ioo,ooo  capital;  must 
)f  a  resident  citizen  to 
il  returns  of  the  condi- 
ments and  executions 
,  Laws  1888. 
d  of  $100  and  also  one- 


vr 


SOUTH  CAROLINA. 


8  »4 


tenth  of  one  per  cent  of  such  part  of  the  capital  stock  as  exceeds  $ioo,- 
000,  Pub,  Stat.  1882,  i>.  85,  8  14.  Shares  of  stock  in  both  domes 
tic  and  foreign  corporations  are  taxed,  unless  the  domestic  corpora- 
tion  is  taxed  as  a  corporation  "for  an  amount  equal  to  the  value  of  its 
property,"  or  unless,  in  the  case  of  a  foreign  corpoiation,  its  shares  of 
stock  are  taxed  where  it  is  located,  p.  122.  Non-resident  stockholders 
in  national  banks,  located  in  the  state,  are  taxed  where  the  bank  exists 
p.  123.  Taxes  are  a  lien  on  such  stock  and  transfers  are  prohibited',, 
p.  124.  -Any  towns  may  require  any  domestic  corporation  to  report  to 
it  concerning  stockholders  residing  in  that  town,  p.  125.  Shares  of  stock 
are  taxed  on  their  cash  market  value,  less  a  proportion  of  the  value  of 
realty  and  machinery  owned  by  the  corporation.  Id.  Savings  banks  pay 
annually  twenty-five  cents  on  each  $100  of  deposits  and  on  each  $100  of 
reserved  profits.  Id.  p.  83,  g  3.  Trust  companies  pay  annually  twenty- 
five  cents  on  each  $100  of  deposits.  Id.  §  4.  Domestic  and  foreign  in- 
surance companies  pay  two  per  cent  on  gross  premiums  and  assessments 
Itl-  §§  S»  6-  Telegraph,  telephone  and  express  companies  pay  one  per 
cent  on  gross  receipts  in  lieu  of  all  other  taxes,  Id.  p.  84,  §§  10,  ii. 

§  34.  SOUTH  CAROLINA.  ConstttutioiiMl  ProTl8lonB.-Stockholders  in 
banks  are  liable  for  corporate  debts  "to  the  amount  of  their  respective 
share  or  shares  of  stock."  No  director  or  officer  shall  borrow  of  the  bank, ' 
Art.  XII.,  §  6.  Mines  and  mining  property  shall  be  taxed  only  upon 
their  proceeds,  Art.  IX.,  §1.  All  corporation  property  is  taxable.  Dues 
from  corporations  shall  be  secured  by  such  individual  liability  of  the 
stockholders  and  other  means  as  may  be  prescribed  by  law.  All  gen- 
eral and  special  incorporating  acts  shall  provide  for  fixing  the  personal 
liability;  shall  prevent  and  punish  fraudulent  misrepresentations  as  to 
capital,  etc.,  and  shall  regulate  use  of  all  franchises,  limit  tolls,  etc., 
Art.  XII. 

Hlseellaaeons  Corporations.— Two  or  more  persons  may  incorporate 
for  "manufacturing,  mining,  industrial,  labor,  immigration  or  other  busi- 
ness, except  for  railroad  purposes,"  Act  No.  288,  L.  1886,  §  i.  All 
subscriptions  are  payable  in  money  or  labor  or  property  at  its  money 
value.  Id.  §  3.  May  organize  after  a  bona  fide  subscription  of  fifty  per 
cent  of  the  proposed  stock.  There  shall  be  from  three  to  nine  directors, 
Id.  §  4.  The  subscription  and  organization  are  accomplished  by  means 
of  a  board  of  incorporators,  Id.  §§  2,  4,  5,6.  The  charter  shall  issue  upon 
the  filing  of  the  certificate  that  twenty  per  cent  of  the  capital  subscribedi 
has  been  paid  in  cash  and  the  remainder  secured,  and  twenty  per  cent; 
of  the  property  subscribed  has  been  delivered,  with  security  for  the  re- 
mainder, Id.  §5.     May  execute  mortgages  and  deeds  of  trust  by  at 


\ 


I— I 


§  34 


SOUTH    CAROLINA. 


98 


majority  stock  vote,  Id.  §  lo.  Each  share  is  entitled  to  one  vote.  Id.  § 
II.  Directors  shall  elect  and  may  discharge  the  president  or  other 
officer,  and  may  fill  a  vacancy  in  the  board.  Id.  §  12.  The  corporation 
has  a  lien  upon  stock  for  all  dues  thereon.  Transfers  are  not  valid 
except  between  parties,  unless  regularly  entered.  Id.  §  14.  Mining  and 
manufacturing  corporations  may  construct  a  railroad  not  exceeding  ten 
miles  in  length,  §  15.  Books  must  be  open  to  stockholders  and  keeping 
false  books  is  a  misdemeanor,  §  17.  Five'years'  non-user  forfeits  the 
charter,  §  18.  The  stockholder's  liability,  other  than  in  railroads  and 
banks,  is  '*  in  an  amount,  besides  the  value  of  his  shares  therein,  not 
exceeding  five  per  cent  of  the  par  value  of  such  shares  held  at  the  time 
the  demand  of  the  creditor  was  created."  This  liability  attaches  for 
corporate  debts  payable  in  one  year  and  enforced  within  two.  Unless 
otherwise  provided  in  the  charter,  fraudulent  misrepresentations  as  to 
the  capital  property  or  resources  by  a  stockholder  or  director  shall  con- 
stitute a  misdemeanor.  The  corporation  may  hold  real  estate  necessary 
for  its  purposes  and  to  secure  debts,  Id.  §  22.  The  amount  of  property 
may  be  limited  by  charter,  §  26.  It  must  organize  within  two  years, 
§  28.     Any  increase  of  stock  or  debt  must  be  by  a  majority  stock  vote, 

§30. 

Railroads. — No  general  incorporatingact  exists.  Connecting  lines  may 

consolidate.  Gen.  Stat.  1882,  §  1425.     Dissenting  stockholders  must  be 

it)ought  out  at  an  appraised  valuation,  §  1432.      Railroads  may  lease 

or    purchase  the  stock  of  connecting   lines,  and  may  guarantee  the 

.bonds  or  stocks  of  connecting  railroad,  §  1434.     May  aid  in  the  con- 

.';struction  of  connecting  railroads  or  steamship  lines  by  subscribing  for 

-.♦stock  or  taking  notes  or  bonds,  etc.,  §    1435.      Proxies  older  than 

:'six  naonths  are  not  valid.     No  one  can  cast  over  one  hundred  proxy 

'votes,  unless  from  one  person.        A  salaried  officer  is  not  to  vote  a 

iproxy,  §  1437.     Stockholders  are  liable  besides  their  stock  liability  to 

\the  amount  of  five  per  cent  of  the  par  value  of  the  stock.  Act  No.  96, 

'Laws  1885.     Consolidations  are  authorized  with  other  companies  in  or 

out  of  the  state.  Id.  §  5.      A  railroad  commissioner  is  given  power 

to  reduce  and  fix  rates  and  regulate  the  railroads  generally,  L.  1888, 

«ch.  27. 

iBanka.— May  be  organized.  No.  288,  L.  1886.  They  are  subject  to 
ifhe  provisions  of  No.  114,  L.  1885,  as  follows  :  Every  director  must 
K)wn  at  least  ten  shares,  §  2.  No  more  than  an  amount  equal  to  one- 
Jialf  the  capital  stock  and  one-half  the  deposits  shall  be  invested  in 
(mortgages  of  real  estate  at  any  one  time.  May  hold  real  estate  necessary 
ifor  business  and  to  secure  debts,  §  3,  as  amended  by  No.  427,  L.  1887. 
'The  liabilitj  of  stockholders  is  for  the  amount  of  their  shares  and  five 


98 


99 


SOUTH  DAKOTA. 


§35 


led  to  one  vote.  Id.  § 
the  president  or  other 

12.  The  corporation 
'ransfers  are  not  valid 
Id.  §  14.  Mining  and 
oad  not  exceeding  ten 
ickholders  and  keeping 
i'  non-user  forfeits  the 

than  in  railroads  and 
his  shares  therein,  not 
hares  held  at  the  time 
;  liability  attaches  for 
d  within  two.  Unless 
isrepresentations  as  to 
r  or  director  shall  con- 
Id  real  estate  necessary 
"he  amount  of  property 
nize  within  two  years, 

a  majority  stock  vote, 

5.  Connecting  lines  may 
g  stockhplders  must  be 
Railroads  may  lease 
md  may  guarantee  the 
.     May  aid  in  the  Con- 
ines by  subscribing  for 
Proxies  older  than 
/er  one  hundred  proxy 
)fficer  is  not  to  vote  a 
their  stock  liability  to 
the  stock,  Act  No.  96, 
1  other  companies  in  or 
issioner  is  given  power 
ads  generally,  L.  1888, 

i6.  They  are  subject  to 
Every  director  must 
n  amount  equal  to  one- 
its  shall  be  invested  in 
old  real  estate  necessary 
ed  by  No.  427,  L.  1887. 
of  their  shares  and  five 


per  cent  in  addition  thereto,  for  all  debts,  §  4.  No  director  shall  bor- 
row money  from  the  bank,  §  5.  The  bank  may  sue  for  unpaid  in- 
stallments or  sell  the  stock  on  twenty  days'  notice.  Books  must  be 
open  for  inspection,  §  6. 

Taxation — Shares  of  stock  are  taxed,  General  Statutes,  1882,  § 
164.  But  not  if  the  corporation  is  required  to  list  its  property  for  tax- 
ation in  the  state,  §  169  L^Qth].  Otherwise,  stock  in  both  domestic 
and  foreign  corporations  is  taxed,  §§  173,  176.  Railroads  are  taxed 
by  a  state  board  and  the  assessment  apportioned  among  the  municipali- 
ties through  which  they  run,  §§  180,  etc.  Domestic  corporations  are 
taxed  on  their  capital  in  proportion  only  to  the  amount  of  tangible 
property  which  they  have  in  the  state,  representing  that  capital,  §  194. 
If  the  whole  property  of  domestic  corporations  is  out  of  the  state,  no 
tax  is  levied  on  its  capital,  §  195.  All  corporations  are  taxed  on  their 
personalty  in  the  state,  the  same  as  individuals,  §  196.  Bank  stock  is 
taxed  at  the  place  where  the  bank  is  located,  §  198,  etc.  The  real  es- 
tate of  banks  is  also  taxed,  §  199.  The  tax  is  a  lien  on  shares,  §  203. 
The  bank  may  pay  the  tax  on  shares  and  deduct  it  from  dividends, 
§  204. 

§  35.  SOUTH  DAKOTA;_In  February,  1889,  by  Act  of  Congress, 
the  territory  of  Dakota  was  divided  and  admitted  into  the  union  as 
North  Dakota  and  South  Dakota.  In  August,  1889,  the  constitutional 
convention  of  South  Dakota  submitted  to  the  people  a  constitution  con- 
taining the  following  provisions  : 

Constitatlonal  Provisions.— No  private  or  special  law  shall  be  passed 
granting  to  any  individual,  association  or  corporation  any  special  or 
exclusive  privilege,  immunity  or  franchise  whatever,  Art.  III.,  §  23. 
No  irrevocable  grant  or  privilege,  franchise  or  immunity  shall  be  made, 
Art.  VI.,  §  12. 

No  privilege  or  immunity  shall  be  granted  to  citizen  or  corporation 
"  which  upon  the  same  terms  shall  not  equally  belong  to  all  citizens  or 
corporations,"  Id.  §  18.  Corporation  property  shall  be  taxed  "as  near 
as  may  be  by  the  same  method  "  as  individual  property  is  taxed,  Art. 
XI.,  §  2.  The  power  to  tax  corporations  shall  not  be  surrendered,  Id. 
§  3.  Stocks  shall  be  taxed.  Id.  §  4.  Exemptions  from  taxation,  with  a 
few  exceptions,  shall  be  void,  Id.  §  7.  Neither  the  state  nor  any 
municipality  shall  loan  or  give  its  credit  to  or  make  donations  to  or  aid 
any  individual,  association  or  corporation,  or  subscribe  tu  or  own  stock, 
or  pay  or  become  liable  for  the  debts  of  such.  The  state  shall  not 
engage  in  any  work  of  internal  improvement,  Art.  XIII.,  §  i.  Cor- 
porations  shall  be  incorporated  under  general  laws,  Art.   XVII.,  §   i. 


35 


SOUTH  DAKOTA. 


100 


Cumulative  voting  is  to  be  allowed,  Id.  §  5.  Foreign  corporations  do- 
ing business  in  the  state  must  have  an  office  and  agent  in  the  state  upon 
whom  process  may  be  served,  Id.  §  6.  Corporations  shall  not  hold  real 
estate  except  such  as  is  necessary  and  proper  for  their  legitimace  busi- 
ness. Id.  §  7.  "Watered"  stock  and  bonds  are  to  be  void.  An  in- 
crease of  stock  or  corporate  indebtedness  is  to  be  allowed  only  upon 
the  consent  of  a  majority  in  interest  of  the  stockholders  given  at  a 
meeting  held  after  sixty  days'  notice,  Id.  §  8.  The  legislature  may 
alter,  revise  or  annul  any  charter,  Id.  §  9.  Street  railroads  shall  be  per- 
mitted only  upon  the  consent  of  the  local  authorities.  Id.  §  10.  No 
telegraph  company  shall  consolidate  with  or  control  a  competing  com- 
pany. Id.  §  II.  All  railroad  corporations  doing  business  in  the  state 
shall  keep  an  office  in  the  state,  where  transfers  of  stock  may  be  made, 
and  shall  keep  open  to  public  inspection,  books  stating  the  capital  stock 
subscribed,  and  by  whom,  the  names  of  the  owners  and  the  amounts 
owned,  the  amount  of  stock  paid  in  and  by  whom,  transfers,  the  amount 
of  corporate  assets  and  liabilities,  and  the  names  and  residences  uf  their 
officers.  Annual  reports  shall  be  made  to  the  state.  Id.  §  12.  Rolling 
stock  shall  be  personalty,  and  subject  to  execution.  Id.  §  13.  Compet- 
ing or  parallel  railroads  shall  not  be  consolidated.  No  consolidation  is 
to  be  allowed  except  upon  sixty  days'  notice  to  all  stockholders.  Id. 
§  14.  The  legislature  may  reduce  the  charges  of  railroads  and  com- 
mon carriers,  Id.  §  15.  Stockholders  in  banks  are  liable  for  corporate 
debts  to  the  extent  of  the  par  value  of  their  stock  in  addition  to  the 
subscription  liability;  such  liability  to  continue  for  one  year  after  a 
transfer  of  the  stock,  Art.  XVlII.,  §   3. 

The   present  statutory  law  .of  Dakota  affecting  corporations  is  as 
follows : 

Miscellimeoas  Corporations.— One-third  of  the  officers  shall  be  resi- 
dents of  the  territory.  Compiled  L.  1887,  §  2897.  Absolute  acceptance 
of  the  statutory  grant  of  corporate  authority  is  necessary  to  constitute 
a  corporation,  §  2898.  Three  or  more  persons  may  incorporate  for  pur- 
poses 'named  in  the  statute,  including  mining,  manufacturing  and  other 
industrial  pursuits,  railroads,  banks  and  trust  companies,  g  2900.  The 
articles  must  be  subscribed  and  acknowledged  by  three  or  more,  one- 
third  of  whom  must  be  residents  of  the  territory,  §  2904.  The  article* 
are  to  be  filed  with  the  secretary  of  the  territory  and  a  certificate  is  to 
issue,  §  2905.  The  corporation  may  forfeit  stock  for  non-payment 
of  subscriptions,  or  may  sue  for  the  subscription,  but  not  both,  §  2914. 
May  provicie  by  by-laws  for  issuing  certificates  of  stock  prior  to  full 
payment,  §  2915.  The  corporation  may  pmcliase  its  own  stock  from 
its  surplus  profits,  §  2917.    May  hold  real  estate  lor  legitimate  purposes 


100 

jn  corporations  do- 
;nt  in  the  state  upon 
s  shall  not  hold  real 
heir  legitimace  busi- 
)  be  void.     An  in- 
allowed  only   upon 
holders  given  at  a 
"he  legislature  may 
ilroads  shall  be  per- 
rities,  Id.  §  lo.     No 
ol  a  competing  com-  - 
iisiness  in  the   state 
stock  may  be  made, 
ing  the  capital  stock 
rs  and  the  amounts 
ransfers,  the  amount 
d  residences  of  their 
;,  Id.  §  12.     Rolling 
,  Id.  §  13.     Compet- 
No  consolidation  is 
ill  stockholders,   Id. 
railroads  and  com- 
e  liable  for  corporate 
:  in  addition  to  the 
or  one  year  after  a 

g  corporations  is  as 

officers  shall  be  resi- 

Absolute  acceptance 

cessary  to  constitute 

Y  incorporate  for  pur- 

lufacturing  and  other 

panics,  g  2900.     The 

three  or  more,  one- 

§  9904.   The  article* 

ind  a  certificate  is  to 

ock  for  non-payment 

but  not  both,  g  2914. 

of  stock  prior  to  full 

e  its  own  stuck  from 

or  legitimate  purposes 


101 


SOUTH  DAKOTA. 


8  36 


within  the  statutory  limit,  §  2919.  A  majority  stock  vote  is  necessary 
to  pass  by-laws,  §  2920.  A  two-thirds  stock  vote  may  delegate  the 
power  to  the  directors,  §  2922.  Each  share  has  one  vote,  §  2925. 
There  shall  be  from  three  to  eleven  directors,  all  holders  of  stock  to  an 
amount  fixed  by  the  by-laws.  Unless  otherwise  provided  in  the  by- 
laws the  board  of  directors  may  fill  a  vacancy,  §  2926.  Directors  are 
personally  liable  for  all  debts  in  case  dividends  are  wrongfully  declared, 
or  the  capital  stock  withdrawn  and  divided,  or  debts  are  created  in  ex- 
cess of  the  subscribed  capital  stock,  or  the  stock  is  increased,  except  as 
specially  provided  by  law.  The  statute  of  limitation  does  not  run 
against  this  liability,  §  2928.  No  director  shall  be  removed  except  by 
a  two-thirds  stock  vote  at  a  meeting  specially  called,  §  2930.  No  one  can 
vote  stock  unless  it  is  recorded  in  his  name  at  least  ten  days,  §  2931. 
Meetings  of  stockholders  and  of  the  board  must  be  held  at  the  principal 
office,  except  that  railroad  directors'  meetings  may  be  held  in  any  place 
in  or  out  of  the  territory,  provided  the  railroad  has  one  or  more  resi- 
dent directors  or  a  duly  appointed  resident  agent;  when  not  otherwise 
provided  all  board  meetings  must  be  called  by  a  special  notice  in  writing 
to  each  director.  A  justice  of  the  peace  may  call  a  general  meeting  on 
the  written  application  of  three  stockholders,  §  2932.  Stockholders  are 
individually  liable  only  for  unpaid  subscriptions  and  such  liability  is  not 
released  by  transfers,  §  2933.  The  capital  stock  may  be  increased  or 
diminished  by  two-thirds  stock  vote  at  a  meeting  specially  called. 

Detailed  records  of  all  transactions  and  all  meetings,  acts,  votes, 
protests,  etc.,  and  also  a  stock  and  transfer  book  shall  be  kept  open 
for  inspection,  §  2937.  If  the  corporation  does  not  organize  and  begin 
operations  within  one  year,  its  powers  cease,  §  2939.  The  corporate 
franchises  may  be  sold  on  execution,  §  2964.  But  may  be  redeemed 
within  one  year,  §  2968.  The  legislature  may  examine  into  the  affairs 
of  all  corporations  at  all  times,  §  2970. 

Manufacturing  and  mining  companies  may  incorporate  for  twenty 
years.  Loans  to  stockholders  are  forbidden,  §  3109.  Records  are  to 
be  open  for  the  inspection  of  stockholders,  §3110.  Stockholders  are 
liable  for  labor  done,  but  the  action  to  enforce  must  be  commenced 
within  four  months,  §  31 11.  Annual  reports  arfc  to  be  made  and  pub- 
lished. Failure  or  falsity  therein  is  a  misdemeanor,  §3112.  Twenty 
per  cent  of  the  stock  may  demand  a  statement  of  the  condition  of  the 
corporation,  §  31 13.  The  corporation  may  have  its  business  office,  and 
may  hold  meetings  of  stockholders  and  directors  out  of  the  territory,  but 
must  have  a  main  office  within  the  territory,  §  31 14. 

Railroads.— Five  or  more  may  incorporate  as  a  railroad  corpora- 
tion by  making,  signing  and  filing  articles  and  certain  affidavits  where- 


i;'  m 


.36 


TENNESSEE. 


103 


upon  a  patent  shall  issue.  If  stock  is  to  be  common  and  preferred, 
the  articles  shall  so  state  and  the  amount  of  each  class,  §  2972.  Direc- 
tors shall  be  from  five  to  thirteen.  They  shall  be  stockholders  entitled 
to  vote  at  the  election.  Each  share  has  one  vote,  §  2974.  Stock  is 
deemed  personalty,  §  2977.  The  capital  stock  may  be  increased  by  a 
two-thirds  stock  vote,  §  2978.  A  railroad  may  borrow  money  and  exe- 
cute trust  deeds  and  mortgages,  §2981.  May  consolidate,  lease  or 
purchase  upon  the  consent  of  a  majority  of  the  stock  in  each  company, 
but  the  capital  of  the  new  company  shall  not  exceed  the  sum  of  the 
consolidated  capitals  at  par,  nor  shall  any  bonds  or  other  evidences  of 
debt  be  issued  as  a  consideration  for,  or  in  connection  with  such  con- 
solidation, §  2986.  Rolling  stock,  fuel,  rights  of  way,  depot  grounds, 
etc.,  are  subject  to  mortgages  or  trust  deeds,  although  subsequently 
acquired,  §  2990.  They  may  set  aside  fifty  per  cent  of  their  net  earn- 
ings for  the  payment  of  debts,  §  2992.  No  railroad  may  plead  usury, 
§  2993.  Annual  reports  must  be  made,  §  2995.  A  foreign  railroad 
may  extend  its  line  into  the  territory  after  filing  a  certified  copy  of  its 
directors'  resolution,  designating  the  proposed  route,  §  2997.  A  rail- 
road commission  exists  with  power  to  recommend,  §§  137-152. 

Foreign  Corporations,— Must  file  a  copy  of  their  charters,  §  3190. 
And  designate  a  resident  agent  to  accept  service,,§3i92. 

Taxation.— Stocks  in  domestic  corporations  and  banks,  and  foreign 
corporations  doing  business  in  Dakota  are  taxed,  §  1543,  and  see  §§ 
1541,  1544.     Depreciated  stocks  may  be  listed  at  their  current  value 
and  rate,  §  1561.     All  corporations  except  banks,  railroads,  etc.,  shall 
make  a  full  return  of  all  property  and  be  taxed  thereon  where  it  is  situ- 
ated, §  1565.     All  bank  stock  is  taxed  to  holders  "on  the  value  of  their 
shares  "  where  the  bank  is  located,  whether  the  holder  resides  there  or 
not.     Domestic  holders  of  foreign  national  bank  stock  are  not  taxed 
thereon,  §  1566.     A  list  of  stockholders  is  to  be  kept  for  the  inspection 
of  assessors,  §  1567.     The  tax  is  a  lien  on  shares,  §  1569.     Dividends 
are  to  be  withheld  until  the  tax  is  paid  and  the  shares  may  be  sold,  §  1570, 
Railroads,  except  street  railroads,  are  taxed,  in  lieu  of  all  other  taxes, 
two  per  cent  of  their  gross  earnings  for  the  first  five  years;  thereafter 
three  per  cent  upon  the  basis  of  sworn  accounts  furnished  by  the   rail- 
road.   The  territory  has  a  lien  on  all  the  property  of  railroads  for  such 
tax  and  said  lien  takes  precedence  over  all  demands,  decrees  and  judg- 
ments, §  1571.     As  to  penalties,  see  §§  1572-1574.     One-third  of  the 
tax  goes  to  the  territory,  the  residue  being  apportioned  among  the 
counties  on  the  line  of  the  railroads,  §  1576.     The  fee  of  the  secretary 
of  the  territory  for  issuing  a  corporation  certificate  is  $5,  §  1403. 

§  36.  TENNESSEE.    Constitational  Provisions.— General  laws  for  in- 
corporation shall  be  passed,  Art.  XL,  §  8.     Corporation  shall  not  be 


109 


103 


TENNESSEE. 


§   3d 


imon  and  preferred, 
ass,  §  2972.  Direc- 
tockholders  entitled 
e,  §  2974.  Stock  is 
ly  be  increased  by  a 
ow  money  and  exe- 
;onsolidate,  lease  or 
k  in  each  company, 
:ceed  the  sum  of  the 
other  evidences  of 
ction  with  such  con- 
way,  depot  grounds, 
hough  subsequently 
t  of  their  net  earn- 
J  may  plead  usury, 
A  foreign  railroad 
;ertified  copy  of  its 
te,  §  2997.    A  rail- 

^§  137-152- 

:ir  charters,  §  3190. 

3192. 

i  banks,  and  foreign 

1,  §  '543.  and  see  §§ 

their  current  value 
railroads,  etc.,  shall 
reon  where  it  is  situ- 
on  the  value  of  their 
Ider  resides  there  or 

stock  are  not  taxed 
ipt  for  the  inspection 

§  1569.  Dividends 
s  may  be  sold,  §  1570. 
ieu  of  all  other  taxes, 
five  years;  thereafter 
rnished  by  the  rail- 
of  railroads  for  such 
Is,  decrees  and  judg- 
4.  One-third  of  the 
lortioned  among  the 

fee  of  the  secretary 
■  is  $5.  §  1403. 
—General  laws  for  in- 
'poration  shall  not  be 


aided  by  the  state,  Art.  II.,  §  31.  Nor  by  municipalities  except  upon  a 
three-fourths  vote  cast  at  an  election  called  for  that  purpose,  Art.  II.,  §  29. 
Hlscellaneong  Corporations. — Five  or  more  persons  of  age  may  in- 
corporate for  purposes  specified  in  the  statute,  including  discount  and 
savings  banks,  by  filing  a  charter  and  application  properly  approved  as 
prescribed  in  the  Code  of  1884,  g  1692.  The  state  and  county  fees  for 
filing  are  $3,  §  1703.  The  directors  are  five  or  more.  All  records  and 
proceedings  and  annual  statements  are  open  to  the  inspection  of  the 
stockholders,  §  1706.  The  right  of  legislative  control  is  reserved,  §; 
1711.  Transferers  are  liable  on  unpaid  subscriptions,  §  1708.  Materiali 
charter  amendments  by  the  legislature  are  binding  only  when  accepted 
by  a  majority  of  the  stockholders.  If  accepted,  dissenting  stockhold- 
ers are  to  be  bought  out.  If  rejected,  the  corporation  is  to  be  dissolved,, 
§  171 1.  Stock  is  personal  property  and  liable  to  execution,  §  1715. 
Fraud  in  creating  a  corporation  and  diverting  its  funds  from  corporate 
purposes  is  a  misdemeanor,  §§  1716,  1717.  Special  provisions  accom- 
pany the  blank  forms  of  charter  in  the  code  for  each  different  kind  of 
corporation. 

Manafactnrlii?,  mlnlngr,  «tc. — Directors  are  made  liable  for  the  amount 
of  loans  to  stockholders,  §  1856,  and  for  corporate  debts  in  excess  of  the 
paid-in  capital,  §§  1858,  187 1.  Stockholders  are  liable  for  debts  ta 
laborers,  etc.,  upon  the  insolvency  of  the  corporation,  §  1858,  Minings 
corporations  may  by  a  three-fourths  stock  vote  invest  in  a  contiguous  rail- 
road, §  i860.  And  they  may  endorse  the  railroad's  bonds  and  issue 
mortgage  bonds  to  raise  money  therefor.  Id.  Stockholders  may  by  a 
three-fourths  vote  fix  the  time  and  place  of  meetings,  §  1863.  The  corpo- 
ration may  take  hold,  and  convey  real  estate  to  secure  debts,  §  1868. 
Charters  may  be  amended,  §  1865.  The  corporation  cannot  loan  money 
but  must  declare  dividends  whenever  able  to  pay  four  per  cent,  §  1870. 
Discount  and  savings  bank  directors  shall  appoint  a  committee  of  mem- 
bers every  six  months  to  investigate  the  affairs  of  the  bank,  §  1728.  When 
any  deposit  shall  amount  to  $50  it  may,  at  the  option  of  the  depositor, 
become  stock,  §  1730.  By  ch.  198, 1..  1887,  all  corporations  are  author- 
ized to  lease  and  dispose  of  their  property  and  franchises  to  any  corpo- 
ration legally  doing  the  same  general  business  within  the  state,  or  they 
may  enter  into  any  agreement  for  its  use  or  operation,  provided  such 
lease  or  contract  shall  be  approved  by  a  majority  stock  vote  at  a  meet- 
ing noticed  sixty  days  ;  but  this  act  shall  not  apply  to  competing  rail- 
road lines.  By  ch.  139,  L.  1887,  incorporation  for  mercantile  business 
is  allowed.  Bych.  78,  L.  1885,  five  adults  may  incorporate  to  purchase, 
improve,  use,  lease,  etc.,  real  estate  not  exceeding  a  parcel  one  hundred 
and  fifty  feet  square. 


87 


TEXAS. 


104 


Five  or  more  "  citizens  "  of  full  age  may  incorporate  for  a  railroad 
or  railway  company,  Code  §  1891.  A  domestic  railroad  company  may 
lease  other  railroads,  §  1250.  And  may  take  a  lease  of  a  road  connect- 
ing with  it,  §  1273.  And  may  buy  the  bonds  and  stocks  and  construct 
or  take  a  lease  of  connecting  lines,  §  1262.  Or  consolidate  with  a  con- 
necting line,  §  1263.  Upon  a  three-fourths  vote  of  all  the  stock,  a  rail- 
road company  may  enter  into  a  lease,  sale  or  consolidation,  may  buy 
and  sell  bonds  or  stocks  of  other  roads  and  may  guarantee  or  indorse 
such  bonds  and  stocks,  §  1275.  Municipal  subscriptions  are  author-' 
ized,  1278.  Connecting  roads  may  be  consolidated  if  dissenting  stock- 
holders are  bought  out,  L.  1886-7,  P-  166.  A  railroad  which  is  author- 
ized to  lease  another  may  guarantee  its  bonds.  Id.  p.  63.  By  ch.  77, 
L.  1885,  the  .act  creating  a  railroad  commission  was  repealed. 

Foreign  Corporations. — Foreign  mining  and  manufacturing  corpora- 
tions may  acquire  essentially  the  same  status  as  a  domestic  corporation 
by  filing  their  charters  with  the  secretary  of  state  and  the  county  register. 
They  may  hold  necessary  real  and  personal  property  which  shall  be 
liable  for  debts.  Resident  creditors  have  a  priority.  They  shall  begin 
work  within  one  year  from  the  time  of  filing  their  charters,  Code  gg 
1992-2003.  See  also  L.  1886-7,  p.  102.  Certain  privileges  are  given  to 
.  foreign  immigration  corporations,  §§  2004,  2005. 

Taxation.— By  ch.  1,  L.  1885,  §  8,  it  is  provided  that  thereafter  no 
tax  shall  be  assessed  upon  the  capital  of  any  bank  or  any  other  corpo- 
ration, but  the  stock  and  bond  holders  shall  be  assessed  and  taxed  on 
the  value  of  their  shares  and  bonds  in  the  municipality  where  the  cor- 
poration is  located.  All  corporations  in  addition  thereto  are  liable  for 
taxes  on  all  other  property,  funds  or  assests.  But  the  property  and 
stock  of  a  Tennessee  corporation  manufacturing  articles  of  the  produce 
of  the  state  shall  be  assessed  as  one  property  in  the  same  manner  as 
property  of  firms  and  individuals.  Officers  are  to  report  on  oath  as  to 
such  stocks  and  bonds,  also  pay  the  tax  and  charge  the  same  to  the  hold- 
ers, Id.  §  9.  Dividends  are  to  be  retained  to  pay  the  tax.  Shares  of  non- 
resident holders  are  liable  and  the  tax  is  a  lien  thereon,  §  11.  Savings 
bank  franchises  are  personal  property  and  are  liable  for  taxes  on  the 
surplus  earned.  Id.  §  13.  Railroad  property  is  assessed  by  a  state 
board  on  schedules  furnished  by  the  company  showing  the  value  of  all 
property,  cost,  dividends,  value  of  stock  and  indebtedness.  The  assess- 
ment is  apportioned  among  the  counties  and  municipalities.  Code  §§ 
669-708. 

§  37.     TEXAS.    ConstltntlonalProTlslons.r-The  state  shall  not  aid 
corporations,  Const,  of  1876,  Art.  III.,  §§  50,  51.     The  state  shall  not 


imm 


104 


105 


TEXAS. 


§  37 


arate  for  a  railroad 
road  company  may 

of  a  road  connect- 
ocks  and  construct 
iolidate  with  a  con- 
ill  the  stock,  a  rail- 
olidation,  may  buy 
arantee  or  indorse 
iptions  are  author- ' 
f  dissenting  stock- 
ad  which  is  author- 

p.  63.  By  ch.  77, 
repealed. 

jfacturing  corpora- 
tmestic  corporation 
the  county  register, 
erty  which  shall  be 
They  shall  begin 
r  charters,  Code  §g 
vileges  are  given  to 

that  thereafter  no 
r  any  other  corpo- 
essed  and  taxed  on 
lity  where  the  cor- 
ereto  are  liable  for 
it  the  property  and 
icles  of  the  produce 
he  same  manner  as 
eport  on  oath  as  to 
le  same  to  the  hold- 
tax.  Shares  of  non- 
eon,  §  II.  Savings 
3le  for  taxes  on  the 
ssessed  by  a  state 
ing  the  value  of  all 
dness.  The  assess- 
licipalities,  Code  §§ 


state  shall  not  aid 
The  state  shall  not 


authorize  municipalities  to  aid  corporations,  Id.  §  52.  Railroads  shall 
not  be  incorporated  by  special  laws.  Id.  g  56.  The  power  of  taxation 
shall  not  be  contracted  away.  Art.  VIII.,  §  4.  Railroads  are  to  be 
taxed  by  the  municipalities.  Rolling  stock  is  to  be  taxed  at  the 
principal  place  of  business  and  apportioned,  Id.  §  8.  Railroads  shall 
keep  a  public  office  in  the  state  and  keep  open  a  book  containing  the 
names  of  stockholders,  etc.,  and  the  assets  and  liabilities  of  the  corpo- 
ration. Directors  must  meet  annually  in  the  state,  Art.  X.,  g  3.  Rolling 
stock  is  personalty.  Id.  g  4.  The  consolidation  of  competing  lines  is 
prohibited.  Id.  g  5.  The  consolidation  of  domestic  with  foreign  rail- 
road corporations  is  prohibited.  Id.  g  6.  Municipalities  shall  not  aid 
corporations.  Art.  XL,  g  3.  Private  corporations  shall  be  created  only 
by  general  laws.  Art.  XII.,  g  i.  Fictitious  bonds  and  stock  are  void, 
Id.  g  6.  No  corporate  body  shall  be  created  with  banking  privileges. 
Art,  XVI.,  g  16. 

Mlscellaneoas  Corporations.— May  incorporate  for  various  purposes 
specified  in  the  statute,  R.  S.  1887,  gg  565,  566.  The  charter  must  be 
subscribed  and  acknowledged  by  three  or  more  persons,  at  least  two 
of  whom  are  citizens  of  the  state.  Married  women  may  be  stock- 
holders and  officers,  g  568.  The  charter  is  subject  to  the  power  of  the 
legislature,  g  574.  Foreign  corporations  must  file  copies  of  their  charters 
and  a  resolution  of  their  directors  designating  an  officer  or  agent  within 
the  state  to  receive  service.  A  permit  issues  from  the  secretary  of 
state  upon  full  compliance  with  the  law.  An  agent  is  subject  to  crimi- 
nal prosecution   for  acting  without  such  permit,  g  574  a. 

Corporations  may  hold  such  real  and  personal  property  as  is 
requisite  for  their  purposes  and  to  secure  debts,  g  575.  The  number 
of  directors  is  to  be  not  less  than  three  nor  more  than  thirteen. 
Id.  By-laws  may  be  adopted  by  the  directors,  but  may  be  altered  by  a 
majority  vote  of  the  stockholders,  g  581.  The  charter  may  be  amended, 
§  571.  Books  and  records  shall  always  be  open  to  the  inspection  of  the 
stockholders,  g  586.  Directors  must  report  upon  the  condition  of 
business  where  one-third  of  the  stockholders  demand  it,  g  587.  Stock- 
holders may,  by  a  motion  in  court,  after  execution  is  returned  unsatis- 
fied as  against  the  corporation,  be  made  subject  to  execution  for  un- 
paid subscriptions,  g  595.  Directors  are  liable  for  debts  to  the  amount 
of  dividends,  knowingly  declared  when  the  corporation  is  insolvent, 
§  S94.  The  principal  office  shall  be  kept  in  the  state,  g  597.  A  busi- 
ness firm  desiring  to  incorporate  without  change  of  name  mus«-  give  a 
newspaper  notice  for  four  successive  weeks  and  until  such  publication 
no  change  occurs  in  their  liability,  g  603.  Charters  are  void  if  opera- 
tions are  not  begun  within  three  years,  g  605.    No  stockholder  shall  be 


mmmm 


TEXAS. 


106 


liable  beyond  the  amount  unpaid  on  his  stock,  §  6io.  Before  foreign 
corporations  do  business  in  the  state  they  must  file  a  certificate  and  ob- 
tain a  permit.  A  license  fee  is  charged,  varying  with  the  capital  stuck.. 
Railroads  need  not  comply  with  this  law,  L.  1889,  ch.  78. 

Trusts   are  defined  and  prohibited  under  penalties,  criminal  liability^ 
and  forfeiture  of  charter,  L.  1889,  ch.  117. 

Irrigation  companies  may  be  incorporated,  L.  1889,  ch.  88. 

Railroads. — Ten  or  more  persons  may   form  a  company,  §  4099.. 
$1,000  per  mile  must  be  subscribed  and  five  per  cent  paid  in,  §  4100^ 
The  articles  must  be  submitted  to  the  attorney  general  for  approval  and 
for  his  certificate,  §  4102.     They  are  then  filed  with  the  secretary  of 
state,  §§  4103-4104.     The  articles  may  be  amended  by  the  same  pro- 
cedure, §§  4108-41 1 1.     Every  railroad  shall  maintain  an  office  upon  its 
line  within  the  state,  §4115.     Directors'   meetings  shall  be  there  held 
and  all  books  shall  be  open  to  inspection.     The  legislature  may,  at  any 
time,  examine  the  books,  §4115  a.     There  shall  be  from  seven  to  nine 
directors,  all  stockholders,  and  a  majority  shall  be  residents,  and  it  shall 
require  a  majority  in  interest  of  the  stock  to  elect  a  director,  g§  4123- 
4126.     By-laws  regulating  the  election  of  director  shall  not  be  changed 
except  at  a  regular  annual  meeting  and  by  a  majority  stock  vote,  §  4127. 
Directors    are    liable    for    false    and    fraudulent    dividends,    §  4133 
A  railroad  shall  not  use  its  funds  to  purchase  its  own  stQck  or  the  stock 
of  another  corporation,  nor  make  a  loan  to  a  director  or  officer,  §  4142. 
Stockholders  are  liable  for  the  amount  unpaid  on  their  stock,  §4143. 
By-laws  are  to  be  made  by  the  stockholders  at  regular  meetings  by  a 
majority  vote  of  two-thirds  in  value  of  all  the  stock.  Id.  §4137.     Books 
shall  be  open  to  the  inspection  of  stockholders.  Id.  §§  4121,  4141-     No 
stock  shall  be  issued  for  less  than  its  par  value.  Id.  §4154.     Officers  are 
liable  for  fictitiously  issued  stock,  Id.  g  4156,     Stockholders  and  directors 
must  meet  once,  at  least,  in  the  state  during  the  year.  Id.  §§4157-8,  see 
also  L.  1885,  p.  67.     Proxies  must  not  be  older  than  six  months,  Id. 
§  4164.  Directors  may  pay  bonds  by  an  issue  of  stock.  Id.  §  4222.  Stock- 
holders may,  by  a  majority  stock  vote,  fix  the  amount  of  loans  and  in- 
terest thereon,  §4152.     Stockholders  may,  by  a  two-thirds  stock  vote, 
remove  the  officers  and  elect  others,  §4153.     Stock  issued  within  thirty 
days  before  a  stockholders'  meeting  is  not  entitled  to  vote  thereat,  nor 
shall   any  stock  be  voted  except  in  proportion    to  the  amount  paid 
thereon,  or  secured  to  be  paid,  §  4165.    The  consolidation  of  parallel  or 
competing  lines  is  prohibited,  §  4246.     No  railroad  of  this  state  shall 
consolidate  with  any  railroad  organized  under  the  laws  of  another  state 
or  of  the  United   States,  §  4247.     Discriminations  are   prohibited,  §§ 
4251  etseq.     All  railroad  property  is   subject  to    execution,    §   4259. 


106 


107 


VERMONT. 


8  sa 


pio.    Before  foreign 

a  certificate  and  ob> 

ith  the  capital  stuck. 

ch.  78. 

ies,  criminal  liability 

889,  ch.  88. 

a  company,  §  4099.. 
cent  paid  in,  g  4100. 
eral  for  approval  and 
with  the  secretary  of 
id  by  the  same  pro- 
ain  an  office  upon  its 

shall  be  there  held 
{islature  may,  at  any 
e  from  seven  to  nine 
residents,  and  it  shall 
a  director,  §§  4123- 
shall  not  be  changed 
ity  stock  vote,  §  4127. 

dividends,  §  4133 
Wn  stQck  or  the  stock 
tor  or  officer,  §  4142. 
n  their  stock,  §4143. 
:gular  meetings  by  a 
k.  Id.  §4137.  Books 
1.  §§4121,  4141.  No 
•§4i54'  Officers  are 
kholders  and  directors 
:ar.  Id.  §§4157-8,866 
than  six  months,  Id. 
ck.  Id.  §  4222.  Stock- 
)unt  of  loans  and  in- 
;wo-thirds  stock  vote, 
k  issued  within  thirty 
i  to  vote  thereat,  nor 
to  the  amount  paid 
slidation  of  parallel  or 
id  of  this  state  shall 
laws  of  another  state 
is  are  prohibited.  §g 

execution,    §   4259. 


Taxation. — Railroad  property  is  assessed  by  county  and  state  assessors, 
upon  verified  statements  of  the  officers,  the  tax  being  the  same  as  upon 
other  property,  §§  4656,  4687,  4678.  All  private  corporations  are  taxed  in 
essentially  the  same  manner,  §  4688.  For  filing  the  certificate  of  a  railroad 
cor|K)ration  a  fee  is  charged  of  $100,  and  $25  for  every  $100,000  capital 
stock  in  excess  of  $100,000;  for  miscellaneous  corporations,  $25  and  $5 
for  every  $10,000  capital  stock  over  $10,000,  ch.  73,  L.  1883,  g  2374  a. 
Banks  are  taxed  by  taxing  the  realty,  and  the  shares  of  stock  less  a  propor- 
tion of  the  value  of  the  realty,  ch.  iii,  L.  1885.  Res  dent  stockholders  in 
foreign  corporation  are  taxed,  ch.  4-  L.  1879.  So  also  are  stockholders  in 
domestic  corporations,  R.  S.,  Art.  4681.  Shares  of  stock  are  not  taxed 
if  the  corporation  is  required  to  list  its  capital  and  property  for  taxation,. 
Id.  4682.  As  to  the  taxation  of  railroads  see  4686-7,  also  constitution- 
al provisions  f»/r<i.  National  and  state  banks  doing  business  in  Texas 
are  taxed  on  their  real  estate.  The  bank  makes  a  sworn  return  of  the 
stock  and  stockholders.  Each  share  is  taxed  on  the  difference  between 
the  actual  cash  value  and  the  proportionate  amount  per  shar^  at  which 
the  realty  is  assessed.  Such  tax  is  a  lien  on  the  share,  which  cannot 
claim  dividends  nor  be  transferred  until  the  tax  is  paid,  g  46686. 

§  38.  YERMONT.  Constltntlonal  ProTisiona.— There  are  none  af- 
fecting corporations. 

Mlseellaneons'Corporations. — Three  or  more  may  incorporate  for 
various  purfioses  specified  in  the  statute,  R.  S.  1880,  §  3267.  "  Mer- 
cantile" business  included.  Act  No.  105,  L.  1884.  Articles  of  associa- 
tion must  be  puulished,  g  3278.  Directors  shall  be  three  or  more. 
Shall  be  stockholders  and  one  shall  be  a  resident,  §  3283.  The  capital 
stock  may  vary  from  $500  to  $1,000,000,  Act  No.  104,  L.  1884.  One- 
half  of  the  capital  stock  shall  be  paid  in  before  the  corporation  con- 
tracts debts.  The  directors  are  liable  for  corporate  de  n  excess  of 
two-thirds  of  the  capital  stock,  §  3291.  Stockholders  au  table  to  cor- 
porate creditors  to  the  amount  of  their  stock  until  the  whole  capital 
stock  is  paid  up,  g  3292.  Books  containing  the  names  of  the  stock- 
holders, etc.,  shall  be  open  to  the  inspection  of  stockholders.  All  cor- 
porate books  are  also  to  be  open  to  their  inspection,  gg  3294,  3295. 

Railroad  Corporations. — Twenty-five  or  more,  a  majority  being  in- 
habitants of  the  state,  may  incorporate,  g  3306.  'One  railroad  shall  not 
subscribe  for  or  hold  the  bonds  or  stock  of  another  railroad,  g  3314. 
At  corporate  meetings  no  subscriber  shall  vote  over  one-tenth  of  the 
capital  stock,  g  3330.  The  treasurer  and  clerk  must  be  residents  and 
the  corporate  books  must  be  kept  within  the  state,  g  3338.  Preferred 
stock  may  be  issued,  g  3339.   The  origmal  subscribers  have  a  pre-emp- 


38 


VERMONT. 


108 


live  right  to  buy  the  preferred  stock,  g  3341.  Guaranteed  stock  may  be 
issujd,  §3343.  Upon  an  increase  of  the  capital  stock  the  stock  is  not  to 
be  issued  below  par,  "  unless  all  the  stockholders  in  the  corporation 
agree,  in  writing,  that  such  shares  may  be  issued  for  a  less  sum,"  g  3344. 
Stock  is  subject  to  attachment  and  levy  of  execution,  g  {345.  Honds 
may  be  issued  upon  a  vote  of  the  stockholders,  §  3350.  On  the  foreclos- 
ure of  a  railroad  mortgage,  and  the  vesting  of  title  in  the  mortgagees,  the 
bondholders  may  incorporate  to  operate  and  own  the  railroad,  §§  3461, 
etc.  Dissenting  bondholders  are  to  be  paid  the  value  of  their  interest, 
§  3469.  If  mortgagees  do  not  purchase,  any  corporate  creditors,  secur- 
ed by  the  mortgage  foreclosed,  may  tender  to  the  purchaser  a  propor- 
tionate part  of  the  purchase  price  and  own  a  corresponding  interest  in 
the  property,  g  3476.  A  railroad  commission  has  power  to  reasonably 
regulate  rates,  ch.  23,  L.  1886. 

Banks.— Five  or  more,  three-fourths  being  residents,  may  incorporate. 
The  capital  stock  may  be  from  $50,000  to  $500,000,  g  3493.  The 
•capital  stock  shall  be  wholly  paid  in  cash  before  business  is  com- 
menced, g  3511.  The  stockholders  are  not  personally  liable  unless  the' 
articles  of  association  so  provide,  g  3531. 

General  Proylslons.— Directors  must  be  stockholders,  g  3253.  Before 
-commencing  business  the  president  and  directors  must  file  a  certificate 
stating  the  amount  of  capital  stock  actually  paid  in,  g  3253.  Stock  may 
be  attached  and  sold  on  execution,  gg  3262,  3263.  The  corporation 
must  have  a  clerk  residing  in  the  state,  g  3267.  A  pledge  of  stock,  is 
effective  when  a  memorandum  is  made  on  the  transfer  book.  Act 
No.  103,  L.  1884.  Many  corporations  are  organized  under  special 
charters  but  by  Act  No.  79,  L.  1886,  they  are  made  subject  to  the  pro- 
visions of  the  revised  laws. 

Taxation. — A  resident  stockholder  in  a  foreign  corporation  is  not 
taxed  if  the  corporation  is  taxed  on  its  whole  stock  or  the  stockholder 
is  taxed  in  the  state  where  the  corporation  exists.  Stockholders  in 
domestic  railroad  corporations  are  not  taxed.  Rev.  Laws  1880,  g  270. 
Factories,  mines,  etc.,  are  exempt  from  taxation  for  a  period  not  longer 
-than  five  years  as  a  majority  of  the  voters  of  the  municipality  may 
elect.  Act  No.  6,  L.  1884,  amending  R.  S.,  g  273.  Shares  of  stock, 
owned  by  residentsor  non-residents,  in  all  corporations,  except  railroads, 
are  taxed,  g  283.  TRe  corporation  pays  the  tax  on  the  shares  of  non- 
residents, g  284.  But  a  proportionate  deduction  is  made  as  to  domestic 
^corporations  for  the  corporate  realty  and  personalty  that  is  taxed,  and 
for  the  realty  of  foreign  corporations,  g  288.  By  Act  No.  5,  L. 
1884,  railroads  are  taxed  on  their  earnings  per  mile  in  the  state,  two- 
per  cent  on  the  first  $2,000  or  less;  three  per  cent  on  the  next  $r,ooo; 


108 

iraiiteed  stock  may  be 
ock  the  stuck  is  not  to 
■s  in  the  corporation 
•r  a  less  sum,"  g  3344. 
ution,  §  {345.  Koncis 
1350.  On  the  foreclos- 
in  the  mortgagees,  the 
the  railroad,  §§  3461, 
'alue  of  their  interest, 
orate  creditors,  secur- 
e  purchaser  a  propor- 
rresponding  interest  in 
s  power  to  reasonably 

lents,  may  incorporate. 
)o.ooo,  §  3493.  The 
fore  business  is  com- 
mally  liable  unless  the' 

olders,  g  325a.  Before 
1  must  file  a  certificate 
".  §  3253-  Stock  may 
63.  The  corporation 
\  pledge  of  stock,  is 
le  transfer  book,  Act 
anized  under  special 
ade  subject  to  the  pro- 

gn  corporation  is  not 
k  or  the  stockholder 
sts.  Stockholders  in 
.  Laws  1880,  g  270. 
or  a  period  not  longer 
the  municipality  may 
73.  Shares  of  stock, 
tions,  except  railroads, 
n  the  shares  of  non- 
is  made  as  to  domestic 
alty  that  is  taxed,  and 
By  Act  No.  5,  L. 
lie  in  the  state,  two- 
on   the  next  $1,000; 


109 


VIRGINIA. 


8» 


four  per  cent  on  the  next  $1,000;  and  five  per  cent  on  ail  over  $4,000 
per  mile. 

By  Act  No.  I,  L.  i88a,  all  state  taxes  are  raised  by  the  taxation  of 
railroad,  insurance,  guarantee,  express,  telegraph,  telephone,  steam- 
boat,  car  and  transportation  companies  and  savings  banks. 

The  "  Maryland  Tax  Commission  "  says  of  Vermont :  "  The  present 
statute  of  Vermont,  which  has  been  in  force  since'  1882,  is  growing  in 
favor,  and  although  its  railroads  have  less  opportunity  for  large 
business  and  handsome  profits  than  the  more  flourishing  of  our  roads, 
the  tax  imposed  is  somewhat  higher  than  we  suggest,  being  two  per 
cent  on  the  first  $2,000  a  mile,  three  per  cent  on  the  third  $1,000,  four 
per  cent  on  the  first  $1,000  above  $3,000  per  mile,  and  five  per  cent 
on  all  earnings  above  $4,000  a  mile.  The  revenues  derived  by  Ver- 
mont from  its  taxes  on  corporation  franchises  and  privileges  are,  and 
have  been  for  years,  sufficient  to  meet  all  expenses  of  the  state  govern- 
ment; and  no  state  tax  is  imposed  upon  property,  thus  leaving  to  the 
counties  and  other  local  bodies  all  revenue  from  that  source." 

g  39.  VIRGINIA.  .CoDBtitntional  ProTlsiong.— ••  The  capital  invested 
in  all  business  corporations  shall  be  assessed  and  taxed  as  other  property. 
Assessments  upon  all  stock  shall  be  according  to  the  market  value 
thereof,"  Constitution  of  1869,  Art.  X.,  g  4.  The  credit  of  the  state  is 
not  to  be  used  to  aid  any  corporation,  Art  X.,  g  12.  The  state  shall 
not  subscribe  or  be  interested  in  any  corporation,  Art.  X.,  g  14.  The 
state  shall  not  aid  internal  improvements,  Id.  g  15. 

MiscelUneoiu  Gorpontlons. — Five  or  more  persons  may  organize  as 
a  joint  stock  company  for  any  lawful  business  except  turnpikes,  rail- 
roads and  banks  of  circulation.  A  certificate  duly  made  and 
acknowledged  is  presented  to  the  circuit  court  or  judge,  and  if  the 
charter  is  granted  it  is  recorded  with  the  secretary  of  state,  Code  of 
1887,  gg  1 145,  1 146.  The  certificate  sets  forth  among  other  things  the 
amount  of  real  estate  proposed  to  be  held,  Id.  The  minimum  capital  is 
$500  in  shares  of  not  less  than  $10.  The  maximum  capital  shall  not 
exceed  twenty  times  the  minimum,  g  1148,  amended  Acts  1887,  ch.  14. 
A  lien  given  by  the  company  to  prefer  one  creditor  shall  inure  to  all,  g 
.  1 149.  A  penalty  of  $100  and  costs  is  imposed  for  failure  to  make  re- 
quired annual  reports,  gg  1152,  1153. 

Oeneral  ProrUions. — Each  share  has  one  vote,  g  11 16.  Stock  is  not 
assignable  until  paid  for,  g  1130.  Books  and  records  are  to  be  open  to 
inspection,  gg  1121,  1123,  1123,  1142.  At  the  time  of  subscription 
$2  must  be  paid  on  each  share  to  the  commissioner,  g  1107.  The 
charters  of    railroad  corporations  are  always  subject  to  legislative 


39 


VIROWTA. 


110 


,1. 
1  }i 


(>  » 


IM^ 


1^1 


amemimcnts,  as  are  all  others  after  fifteen  years  from  their  passage, 
§  1340,  1069.  No  corporation  shall  hold  any  more  real  estate  than  ii 
proper  for  the  purposes  of  its  incor|Xjration.  One  company  shall  not 
subscribe  to  or  acquire  stock  of  another  I'niess  specially  authorized,  g 

1070.  Hut  may  receive  stock  in  satisfaction  of  or  to  secure  debts,  ^ 

107 1.  Companies  for  internal  improvement  may  enter  upon  and  take 
lands,  §§  1073,  e/se^.  Every  company  must  keep  an  office  in  the  state 
for  settlinj;  claims  of  residents;  forei((n  companies  must  appoint  an 
agent  on  whom  process  may  be  served;  a  copy  of  their  charter  with 
a  power  of  attorney  must  be  recorded  with  the  secretary  of  state, 
whose  fee  shall  be  $10,  §  1104.  Of  joint  stock  companies,  generally, 
see  §g  1106-1153.  Subscriptions  to  railroads  may  be  in  land,  §  1108. 
One-tenth  of  the  stock  may  call  a  meeting,  §  11 14.  Stockholders 
may  remove  directors  and  fill  the  vacancies,  §1118.  A  major- 
ity in  interest  constitutes  a  meeting,  §  11 15.  No  compensation  is  al- 
lowed to  the  president  or  directors  unless  the  stockholders  vote  it,  § 
1 1 19.  Stock  shall  not  be  sold  for  less  than  par  and  may  be  sold  for 
more  than  par,  §  11 34.  The  transferer  and  transferee  are  liable  for  un- 
paid subscriptions,  §  1130.  An  unrecorded  purchaser  or  pledgee  is 
protected,  g  1133.  Dividends  may  be  applied  to  the  debts  of  stock- 
holders due  to  the  corporation,  §  1 136.  The  capital  stock  of  manufactur- 
ing or  mining  companies  out  of  debt  may  be  divided  upon  three 
months' public  notice,  §  1 139.  The  terms  on  which  foreign  express 
companies  may  do  business  in  the  slate  are  prescribed  by  statute.  A 
county  or  city  shall  not  subscribe  to  more  than  one-fifth  of  the  stock  of  an 
internal  improvement  company,  nor  an  amount  the  interest  upon  which 
would  require  a  tax  of  more  than  30  cents  on  $100,  §  1343.  Three- 
fifths  of  the  qualified  voter >  of  a  municipality  must  have  voted  "for 
subscription"  at  an  election  duly  held,  §§  1244,  1345.  Corporations 
are  not  allowed  to  plead  usury,  §  3835.  Nor,  unless  expressly  author- 
ized, to  take  more  than  legal  interest,  §  3836. 

Banks  of  Diseoant  and  Deposit— There  shall  be  not  less  than  five 
directors,  a  majority  of  whom  shall  be  citizens  of  the  state,  g  1157. 
They  must  own,  at  least,  $100  of  stock  in  their  own  right  and  must  take 
an  oath,  gg  1165,  1166,  Amended  Acts  1887-8,  p.  330.  The  bank  may 
hold  real  estate  only  for  its  immediate  accommodation  and  to  secure 
iona  fide  debts,  g  1163.  No  loan  to  be  made  on  stock  until  it  is  paid 
up,  g  1 164.  Loans  to  one  party  shall  not  exceed  one-tenth  of  the  capi- 
tal stock,  g  1 168.  Duly  sworn  and  attested  reports  and  statements  must 
be  rendered  to  the  auditor  and  be  published.  One-fifth  in  value  of  the 
stock  can  demand  a  special  examination  of  the  bank's  condition.  There 
is  a  heavy  penalty  for  a  failure  herein  and  for  false  statements,  gg  1170, 
1171. 


110 


111 


WASHINGTON. 


8  40 


s  from  their  passage, 
re  real  estate  than  li 
e  company  Hhall  not 
ecially  authorized,  ^ 
}r  to  secure  debts,  § 
'  enter  upon  antl  take 
I  an  office  in  the  state 
lies  must  appoint  an 
of  their  charter  with 
e  secretary  of  state, 
companies,  generally, 
ly  be  in  land,  §  iio8. 
1 1 14.  Stockholders 
§    1 1 18.     A   major- 

0  compensation  is  al- 
ckholders  vote  it,  § 
ind  may  be  sold  for 
feree  arc  liable  for  un- 
rchaser  or  pledgee  is 

1  the  debts  of  stock- 
1  stock  of  manufactur- 
I  divided  upon  three 
vhich  foreign  express 
;ribed  by  statute.  A 
■firth  of  the  stock  of  an 
e  interest  upon  which 
00,  §  1243.  Three- 
just  have  voted   "for 

1245.      Corporations 
less  expressly  author- 

e  not  less  than   five 

of  the  state,  g  ii57. 

m  right  and  must  take 

320.     The  bank  may 

dation  and  to  secure 

stock  until  it  is  paid 

one-tenth  of  the  capi- 

ts  and  statements  must 

e-fifth  in  value  of  the 

nk's  condition.    There 

ie  statements,  §§  1170, 


Taxation.— The  fees  for  filing  pajiers,  making  entries,  copies,  etc.  ^ 
iirc  double  those  for  deeds,  j|  1151.  Shares  of  stock  are  deemed  |)er- 
sonal  estate,  §1125.  *'  If  the  property  consist  of  money,  bonds,  stocks 
■or  other  evidences  of  public  or  private  debts,  in  any  county  or  city  other 
than  that  of  his  residence,  or  state  other  than  Virginia,  it  shall  be  listed 
by  and  taxed  to  the  owner  thereof,"  g  492.  "  If  the  pro|>erty  belong  to 
j&  corporation,  which  property  is  not  otherwise  taxed,  it  shall  be  listed  to 
the  cor|H)ration  by  the  accounting  officer,  and  at  the  principal  place  of 
business  of  such  corporation,  but  if  not  so  listed,  it  shall  be  listed  and 
taxed  in  the  place  where  the  property  is,"  §  492.  The  Act  of  1874,  p, 
JOG,  imposed  a  tax  of  fifty  cents  on  every  $100  of  the  cor|K>rate  capital 
not  otherwise  taxed.  Real  estate  is  taxed  as  property  and  not  as  capi- 
tal. The  income  from  stocks  and  bonds,  not  otherwise  taxed,  shall  be 
taxed  one  per  cent  on  the  amount  of  such  income  in  excess  of  $600,  Id. 
,p.  301.  Railroads  arc  taxed  fifty  cents  for  every  $100  of  value  in  addi- 
ction to  an  income  tax  of  one  per  cent  upon  the  net  receipts.  The  valua- 
tion is  made  by  the  auditor  on  the  basis  of  the  companies'  reports,  or 
•upon  the  failure  to  make  such,  at  the  rate  of  $12,000  per  mile  for  the 
iToad  and  rolling  stock,  Id.  p.  353. 

§  40.    WA8HIN6T0N._In  February,  1889,  the  territory  of  Washing. 
Tton  was  admitted  as  a  state.     The  constitutional  convention  in  August, 
1889,  submitted  to  the  people  a  constitution  containing  the  following 
provisions  :     No  irrevocable  privilege,,  franchise  or  immunity,  shall  be 
granted.  Art.  I.,  §  8.     Privileges  or  immunities  shall  not  be  granted  to 
citizens  or  corporations  "  which,  up>on  the  same  terms,  shall  not  equally 
belong  to  all  citizens  or  corporations,"  Id.  §  12.     Special  laws  snail  not 
be  passed  for  granting  corporate  powers  or  privileges,  Art.  II.,  §28. 
•Corporations,  the  majority  of  whose  stock  is  owned  by  aliens,  shall  not 
«wn  land  actually  or  in  trust,  except  mineral  and  coal  lands,  Id.   §  33. 
Public  officers  shall  not  accept  or  use  passes  from  railroads  or  corpora- 
.tions,  nor  purchase   tickets  on  favored  terms,  Id.  §  39.     Corporation 
property  shall  be  taxed  as  near  as  may  be,  by  the  same  methods  as  in- 
wdividual  property  .i  taxed.  Art.  VII.,  §  3.     The  power  to  tax  corpora- 
tions shall  not  be  sunendered  or  contracted  away,  Id.  §  4.     The  credit 
of  the  state  shall  not  be  given,  or  loaned  to,  or  in  aid  of  any  corporation 
or  association,  Art.  VIII.,  §5.     No  municipality  shall  give  money  or 
property,  or  loan  or  credit  to,  or  in  aid,  of  any  corporation  or  become 
ithe  owner  of  their  stock  or  bonds.   Id.  ^  /.     Corporations  must  be 
formed  under  general  laws,  and  charters  may  be  altered,  amended  or 
repealed,  Art.  XII.,  §  i.     Stockholders,  except  in  banks  and  insurance 
«onipanies,  »iSi  liable  only  for  unpaid  subscriptions,  Id.  §  4.     Stocks 


§  40 


WASHINGTON. 


112 


Pi; 


shall  be  issued  only  to  ^<7«a/fr/(f  subscribers  or  their  as^^ignees.  "Watered" 
stock  shall  be  void,  Id.  §  6.  Foreign  corporations  are  to  have  no  greater 
privileges  than  domestic  corporations,  Id.  §  7.  Franchises  leased  or 
sold  are  to  be  subject  to  the  liabilities  of  the  lessor  and  grantor,  Id.  §  8.. 
The  state  shall  not  loan  its  credit  to  or  be  interested  in  the  stock  of  any 
corporation,  Id.  §  9.  Stockholders  in  banks  and  insurance  corporations 
are  liable  to  the  extent  of  the  par  value  of  their  stock  in  addition  to  the 
subscription  liability  fer  deuts  accruing  while  they  remain  stockholders. 
Id.  §  II.  Officers  of  a  bank  receiving  money  for  it  after  they  know  it 
is  insolvent,  are  liable  therefor,  Id.  §  12.  Discriminations  in  railroad 
charges  are  forbidden,  Id.  §  15.  Competing  railroads  shall  not  be  con- 
solidated, Id.  §  16.  Rolling  stock  shall  be  personalty  and  subject  to 
execution,  Id.  §  17.  Railroads  and  other  transportation  companies  shall 
not  grant  free  passes  or  sell  tickets  at  a  discount  to  legislators  or  public 
officers.  Id.  §  20.  "  Monopolies  and  trusts  shall  never  be  allowed  in 
this  state,  and  no  incorporated  company,  co-partnership  or  association 
of  persons  in  this  state  shall  directly,  or  indirectly,  combine  or  make 
any  contract  with  any  other  incorporated  company,  foreign  or  domestic, 
through  their  stockholders,  or  the  trustees  or  assignees  of  such  stock- 
holders, or  with  any  co-partnership  or  association  of  persons,  or  in  any 
manner  whatever  for  the  purpose  of  fixing  the  price  or  limiting  the  pro- 
duction or  regulating  the  transportation  of  any  product  or  commodity," 
Id.  §  22. 

The  territorial  statutory  laws  of  Washington  as  affecting  corporations 
is  as  follows: 

Miscellaneous  Corporations. — Any  two  more  may  incorporate  for 
any  species  of  trade  or  business,  Code  of  Washington,  188 1,  §§  2421, 
2422.  But  shall  not  commence  business  or  have  land  condemned  until  the 
whole  amount  of  the  capital  stock  is  subscribed,  Id.  The  period  of  ex- 
istence is  fifty  years,  §  2422,  L.  1885-6,  p.  84.  Stockholders  have  power 
to  remove  the  directors  "at  will,  except  that  no  trustee  shall  be  removed 
from  office  unless  by  a  vote  of  two-thirds  of  the  stockholders  "  in  in- 
terest, §  2424.  The  corporation  may  purchase,  hold,  mortgage,  sell  and 
convey  rea!  and  personal  property,  §  2423  (3).  There  shall  be  not  less 
than  two  trustees  who  shall  be  stockholders  and  a  majority  of  them 
citizens  of  the  United  States  and  residents  of  the  territory,  §  2425.  By 
by-law,  votes  may  be  allowed  only  to  full-paid  stock  or  the  full-paid  stock 
which  the  assessment  already  paid  amounts  to,  §  2425.  Stockholders 
are  not  liable  to  corporate  creditors,  except  to  the  extent  of  the  unpaid 
subscriptions,  §  2434.  The  capital  stock  of  banks  must  be  at  least 
$25,000  and  three-fifths  paid  in,  Act  of  1885,  p.  84.  Bank  stockholders 
are  liable  for  the  par  value  of  their  stock  in  addition  to  the  subscription 


112 

ir  assignees.  "  Watered  " 
)ns  are  to  have  no  greater 
7.  Franchises  leased  or 
ssor  and  grantor,  Id.  §  8^ 
ested  in  the  stock  of  any 
id  insurai;ce  corporations 
stock  in  addition  to  the 
ley  remain  stockholders, 
For  it  after  they  know  it 
criminations  in  railroad 
ilroads  shall  not  be  con- 
;rsonalty  and  subject  to 
portation  companies  shall 
It  to  legislators  or  public 
lall  never  be  allowed  in 
jtnership  or  association 
ectly,  combine  or  make 
any,  foreign  or  domestic, 
issignees  of  such  stock- 
5n  of  persons,  or  in  any 
jrice  or  limiting  the  pro- 
product  or  commodity," 

I  as  affecting  corporations' 

lore  may  incorporate  for 
shington,  1881,  §§  2421, 
land  condemned  until  the 
1,  Id.  The  period  of  ex- 
Stockholders  have  power 
trustee  shall  be  removed 
the  stockholders  "  in  in- 
,  hold,  mortgage,  sell  and 
There  shall  be  not  less 
i  and  a  majority  of  them 
lie  territory,  §  2425.  By 
tock  or  the  full-paid  stock 
,  §  2425.  Stockholders 
the  extent  of  the  unpaid 
banks  must  be  at  least 
).  84.  Bank  stockholders 
dition  to  the  subscription 


113 


WEST  VIBOINIA. 


§  41 


liability.  Id.  Stock  is  personal  estate,  §  2429;  and  is  attachable,  §  178. 
Stock  books  must  be  kept  open  for  the  inspection  of  stockholders  and 
creditors,  §  2436,  Railroad  bonds  shall  not  exceed  double  the  paid-up 
stock,  §  2434. 

Foreigrn  Corporations. — May  do  any  act  in  the  territory  that  they 
could  do  if  incorporated  in  the  territory,  §  2478.  May  acquire,  hold, 
use  and  dispose  of  real  estate,  §  2479.  Must  file  a  copy  of  their  charter 
or  certificate  and  of  the  general  statute  under  which  ihrty  are  incorpo- 
rated, §  ?,48o.  Assessors  are  obliged  to  icport  the  same  to  the  secre- 
tary of  si  ate,  §§  2482,  etc.  Land  held  by  a  foreign  corporation  is  not  to 
exceed  5,000  acres.  Act  of  1885,  p.  87.  Foreign  corporations  incorpor- 
able  for  land  purposes  are  forbidden  to  carry  on  such  business.  Id. 

Taxation. — "  The  owner  or  holder  of  stock  in  any  firm  or  corpora- 
tion, the  capital  or  property  whereof  is  assessed,  must  not  be  assessed 
individually  for  his  stock  in  such  fiim  or  corporation,"  §  2840.  Cor- 
porate property  must  be  assessed  in  the  county  where  the  property  is 
situated,  §  2041.  But  shares  of  stock  are  otherwise  subject  to  taxation, 
§  2830.  National  bank  stock  is  assessed  against  the  bank  where  it  is  locat- 
ed, §  2849.  Railroad  property  exclusively  used  in  the  operation  of  a  line  is 
assessed  at  its  cash  value  and  apportioned  among  the  counties  traversed. 
The  roadway  and  track  are  real  estate.  Rolling  stock  is  personalty. 
All  other  property  of  railroads  is  taxed  as  though  private  property,  §g 
2850-2855.  By  Act  of  1883,  p.  64,  railroad  corporations,  in  lieu  of  all 
other  taxation  of  their  rights,  property  or  capital  stock,  must  pay  for  the 
first  five  years  of  their  operation  two  per  cent  of  their  gross  earnings  into 
the  territorial  treasury,  and  three  per  cent  thereafter. 

§41.  WEST  TIRttlNIA.  Constitutional  Provisions.— The  state  can- 
not aid  or  fiecome  interested  in  any  corporation,  Constitution  of  1872, 
Art.  X.,  §  6.  No  corporation  shall  be  created  by  special  law.  Art.  XI., 
§  I.  Stockholders  shall  not  be  liable  on  their  stock,  except  for  unpaid 
subscriptions,  Art.  XI.,  §  2.  Cumulative  voting  shall  exist,  Art.  XI.,  §  4.* 
Stockholders  in  banks  are  liable  on  their  stock  to  an  amount  equal  to  its 
par  value,  in  addition  to  the  unpaid  subscription,  "  for  all  its  liabilities 
accruing  "  while  th„y  are  such  stockholders,  Art.  XI.,  §  6.*  Railroads 
must  report  annually  on  the  "condition  of  their  affairs,"  etc..  Art.  XI.,  §  7. 
Rolling  stock  is  personalty  and  is  subject  to  levy  of  execution,  Art.  XI., 
§  8.  The  consolidation  or  leasing  of  parallel  lines  is  forbidden,  except 
with  the  consent  of  the  legislature,  Art.  XI.,  §  11. 

Miscellaneons  Corporations. — Incorporation  may  be  had  for  any  law- 
ful business,  except  for  religious  purposes,  or  for  buying  and  selling 

'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xxxvii. 

*  Id. ,  chapter  xii. 


§41 


WEST  VIRGINIA. 


114 


ur 


lands,  Code  ch.  54,  §§  a,  3.  The  capital  stock  is  not  to  exc'  i 
$5,000,000,  except  in  railroad  and  canal  corporations,  §  5,  as  amended 
in  1887.  Five  or  more  are  necessary  to  incorporate,  §  6.  Ten  per 
cent  of  the  capital  stock  must  be  paid  in  upon  incorporation,  §  7.  The 
original  agreement  must  be  acknowledged  and  be  delivered  to  the  sec- 
retary of  state  together  with  affidavits  of  two  incorporators  that  the 
ten  per  cent  has  been  paid  in,  etc.,  §§  8,  9.  The  objects  of  incorpo- 
ration may  be  enlarged  or  diminished  upon  the  consent  of  the  majority, 
§  10.  Meetings  of  stockholders  may  be  held  out  of  the  state,  and  the 
principal  office  may  be  out  of  the  state  if  the  majority  of  the  stock- 
holders assent,  and  reasonable  notice  is  given,  §  23.  Generally  the 
capital  stock  is  fixed  at  $500,  with  the  privilege  of  increase  and  then 
after  the  charter  is  obtained  the  increase  is  made  for  property  under  § 
16.  Every  corporation  formed  under  this  act,  but  having  its  principal 
office  outside  the  state,  shall  designate  an  agent  within  the  state  to  ac- 
cept service  and  report  the  property  for  taxation.  The  power  of  attor- 
ney mtist  be  recorded  with  the  county  clerk  and  the  secretary  of  state^ 

§  24. 

Railroad  Corporations. — Five  or  more  persons  may  form  a  railroad 

corporation,  §  31,  L.  1881,  ch.  17.  There  shall  be  .rom  five  to  thirteen 
directors.  A  majority  of  the  stockholders  present  at  any  meeting  may 
require  a  statement  of  affairs,  §  38,  and  L.  1882,  ch.  98.  '•  All  stock- 
holders shall  at  reasonable  hours,  have  access  to,  and  may  examine,  all 
the  books,  records  and  papers  of  such  corporation,"  id.  Special  meet- 
ings of  stockholders  may  be  called  upon  a  thirty  days'  newspaper 
notice  by  a  majority  of  the  directors  or  one-fourth  in  value  of  the 
stockholders,  §  39,  and  L.  1881,  ch.  17.  Stockholders  may  meet  out 
of  the  state,  and  the  principal  place  of  business  may  be  out  of  the  state, 
§  40,  and  L.  1882,  ch.  97.  But  there  must  be  an  office  in  the  state  with  a 
full  set  of  books  for  inspection,  Id.  The  original  subscribers  are  liable 
for  the  unpaid  subscriptions,  and  transferees  are  not  liable,  §  47,  and  - 
L.  1882,  ch.  97.  The  corporation  may  issue  preferred  stock  ;  may 
borrow  money  and  give  mortgages  on  the  consent  of  two-thirds  of  the 
stock  ;  and  may  issue  bonds  convertible  into  stock,  §  50,  and  L.  1881,, 
ch.  17,  L.  1887,  ch.  40.  May  issue  stock  or  bonds  at  less  than  par,  for 
property,  land,  money,  labor,  etc.  But  fictitious  stock  and  stock  divi- 
dends are  void,  g§  52,  68,  and  L.  1881,  ch.  17,  L.  1882,  ch.  97.  The 
consolidation,  purchase  or  lease  of  connecting  lines  is  authorized  on  a 
majority  vote,  and  upon  sixty  days'  notice,  but  this  is  not  applicable  to 
comiieting  lines,  §  53,  and  L.  1883,  ch.  12;  but  see  amendment  ch.  33^ 
L.  1889.  Cumulative  voting  is  to  prevail,  §56,  and  L.  1881,  ch.  17. 
Subscriptions  to  railroads  may  be  made  by  cities,  towns  and  villages,  § 


lU 


116 


WEST   VTIRQINIA. 


§41 


tock  is  not  to  exc^  ^ 
ations,  §  5,  as  amended 
rporate,  §  6.  Ten  per 
incorporation,  §  7.  The 
ae  delivered  to  the  sec- 
I  incorporators  that  the 
The  objects  of  incorpo- 

consent  of  the  majority, 
)ut  of  the  state,  and  the 

majority  of  the  stock- 
,  §  23.  Generally  the 
re  of  increase  and  then 
de  for  property  under  g 
but  having  its  principal 
t  within  the  state  to  ac- 
n.  The  power  of  attor- 
d  the  secretary  of  state, 

ons  may  form  a  railroad 
1  be  .  1  om  five  to  thirteen 
sent  at  any  meeting  may 
i82,  ch.  98.     "  All  stock- 
:o,  and  may  examine,  all 
ion,"  id.     Special  meet- 
thirty  days'   newspaper 
e-fourth  in  value  of  the 
kholders  may  meet  out 
s  may  be  out  of  the  state, 
m  office  in  the  state  with  a 
nal  subscribers  are  liable 
are  not  liable,  §  47,  »"<* 
le  preferred  stock  ;  may 
lent  of  two-thirds  of  the 
stock,  §  50,  and  L.  1881, 
»onds  at  less  than  par,  for 
)us  stock  and  stock  divi- 
17,  L.  1882,  ch.  97.    The 
lines  is  authorized  on  a 
t  this  is  not  applicable  ta 
ut  see  amendment  ch.  32, 
56,  and   L.  i88i,ch.  17. 
:ies,  towns  and  villages,  g 


57,  and  L.  1881,  ch.  17.  Any  railroad  company  by  consent  of  two- 
thirds  of  the  stock  may  "  become  surety  for  or  guarantee  the  bonds, 
stock  or  debts,"  of  another  railroad,  or  aid  it  or  lease  itself  to  it,  if  not 
a  competing  road,  §  82a. 

Banks.— The  capital  stock  shall  be  not  less  than  $25,000  nor  more 
than  $500,000,  §  77,  and  L,  i88i,  ch.  17.  Stockholders  are  liable  for 
the  amount  of  their  stock  over  and  above  the  amount  invested  therein, 
§  78.  Directors  shall  be  stockholders  and  shall  take  an  oath,  §  79. 
No  meeting  shall  be  held  out  of  the  state,  §  80.  Savings  banks  may  be 
organized  by  thirteen  or  more  of  whom  three-fourths  shall  reside  in  the 
country.  See  details  of  provisions  in  L.  1887,  ch.  18.  The  profits  be- 
long to  the  depositors.  Id. 

General  provisions  applicable  to  corporations — "  Unless  special!;' 
authorized,  no  corporation  shall  purchase  real  estate,  in  order  to  sell 
the  same  for  profit,  or  hold  more  real  estate  than  is  proper  for  the  pur~ 
poses  for  which  it  is  incorporated,  subscribe  for,  or  purchase  the  stock, 
bonds,  or  securities  of  any  joint  stock  company,  or  become  suiety  or 
guarantor  for  the  debt  or  default  of  such  company,"  Code  ch.  52, 
§  3,  and  see  ch.  53,  §3.  But  "any  railroad  may,  with  the  assent  of 
the  holders  of  two-thirds  of  its  stock,  had  by  a  vote  at  a  stockholders' 
meeting,  become  surety  for,  or  guarantee  the  bonds,  stock,  or  debt  of 
any  railroad  company,  or  in  any  other  manner  aid  such  railroad  com- 
pany in  the  construction  of  its  railroad,  or  other  works,  or  improve- 
ments, and,  with  like  consent,  may  lease  its  road  to  any  other  railroad 
corporation  within  this  state."  But  this  does  not  apply  to  parallel  or 
competing  lines.  Code  ch.  54,  §  82a.  An  internal  improvement  com- 
pany may  lay  out  a  town  of  640  acres,  and  sell  lots.  Any  corporation 
may  take  real  estate,  stocks,  etc.,  in  payment  of,  qr  as  security  for 
debts.  Any  manufacturing  company  may,  with  the  assent  of  two-thirds 
of  the  stock,  subscribe  for  or  purchase  stock,  etc.,  of  any  corporation 
which  furnishes  materials  to,  or  deals  in  the  products  of  the  subscribing 
company,  or  of  a  railroad,  or  other  internal  improvement  in  the  coun- 
ty. Id.  ch.  52,  §  4.  "  No  share  shall  be  transferred  without  the  con- 
sent of  the  board  of  directors,  until  the  same  is  fully  paid  up,  or  secur- 
ity given  to  the  satisfaction  of  the  board  for  the  residue  remaining  un- 
paid," ch.  53,  §  22.  Corporations  shall  not  plead  usury,  ch.  52,  §23.  ''At 
least  ten  per  cent  of  the  par  value  of  each  share  shall  be  paid  at  the  time 
of  subscription,"  ch.  53,  g  25.  Security  rnay  be  required  for  the  payment 
of  the  balance  on  stock  not  paid  up,  §  31.  The  certificates  of  stock 
shall  show  the  amount  paid  on  each  share,  §  35.  Transfers  without  a 
delivery  of  the  certificates  are  forbidden,  unless  lost,  etc.,  §  36.  Cu- 
mulative voting  prevails,  §  44.      No  officer  or  director  shall  vote   as  a 


§41 


WEST  VIRGINIA. 


116 


proxy,  §  45.  Full  annual  reports  are  required,  §  46.  "  The  property 
and  funds,  books,  correspondence,  and  papers  of  the  corporation,  in 
the  possession  or  control  of  any  officer  or  agent  thereof,  shall  at  all 
times  be  subject  to  the  inspection  of  the  board  or  a  commiUee  thereof, 
appointed  for  the  purpose,  or  of  any  committee  appointed  for  the  pur- 
pose by  a  general  meeting  of  the  stockholders.  The  minutes  of  the 
resolutions  and  proceedings  of  the  board  shall,  for  thirty  days  before 
the  annual  meeting  of  the  stockholders,  be  open  to  the  inspection  of 
any  stockholder.  They  shall  be  produced  when  required  by  the  stock- 
holders at  any  general  meeting,"  §  47.  A  general  meeting  of  stockhold- 
ers may  be  called  by  the  directors,  or  by  one-tenth  in  value  of  the 
^stockholders,  §  41. 

There  shall  be  five  directors,  unless  the  stockholders  order  otherwise. 
Directors  are  to  be  residents  and  stockholders,  unless  the  stockholders 
order  otherwise.  "The stockholders  in  general  meeting  may  remove 
any  director  and  fill  the  vacancy,"  §  49.  "  No  member  of  the  board 
shall  vote  on  a  question  in  which  he  is  interested,  otherwise  than  as  a 
stockholder,  except  the  election  of  a  president,  or  be  present  at  the 
board  while  the  same  is  being  considered,  but  if  his  retiring  from  the 
board  in  such  case  reduces  the  number  present  below  a  quorum,  the 
question  may  nevertheless  be  decided  by  those  who  remain,"  §  52. 

''There  shall  be  no  compensation  for  services  rendered  by  the  pre- 
sident or  any  director,  unless  it  be  allowed  by  the  stockholders,"  §53. 
The  court  may  "  on  application  of  a  creditor  or  stockholder,  sufficient 
cause  being  shown  therefore,  appoint  one  or  more  persons  to  be  re- 
ceivers to  take  charge  of  and  administer  its  assets,"  §  58.  A  corpora- 
tion shall  not  hold  more  than  one  hundred  acres  of  land,  except  that 
salt,  oil,  and  springs  companies  and  manufacturing  companies  may  hold 
one  thousand  acres  and  over,  and  mining  and  coal  companies  ten  thousand 
acres  or  over.  Not  more  than  five  acres  to  be  held  in  an  incorporated 
town  or  city,  §62,  L.  1882,  ch.  96.  A  failure  to  organize  within  one 
year  after  the  date  of  the  certificate  issued  under  the  general  law,  and  a 
suspension  of  corporate  business  for  two  years  by  any  corporation  shall 
forfeit  the  corporate  rights,  ch.  53.  §§  6,  7.^  Stockholders  may  author- 
ize the  issuing  of  preferred  stock,  but  the  maximum  capital  shall  not  be 
exceeded,  and  a  newspaper  notice  must  be  given  for  four  weeks,  Id.  § 
16.     There  shall  not  be  less  than  five  stockholders,  Id.  §  17. 

Foreign  corporations  must  file  a  copy  of  their  charter  or  the  gen- 
eral act  under  which  tl^^y  are  incorporated  before  business  is  transact- 
ed.    Must  also  file  a  writing  under  seal  accepting  the  provisions  of  this 


'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  zxzviii. 


116 

!,  §  46.  "  The  property 
s  of  the  corporation,  in 
:nt  thereof,  shall  at  all 
1  or  a  commiUee  thereof, 
;  appointed  for  the  pur- 
The  minutes  of  the 
,  for  thirty  days  before 
pen  to  the  inspection  of 
en  required  by  the  stock- 
:ral  meeting  of  stockhold- 
e-tenth   in  value  of    the 

:kholders  order  otherwise. 
>,  unless  the  stockholders 
•al  meeting  may  remove 
o  member  of  the  board 
:sted,  otherwise  than  as  a 
ent,  or  be  present  at  the 
t  if  his  retiring  from  the 
nt  below  a  quorum,  the 
se  who  remain,"  §  52. 
ces  rendered  by  the  pre- 
|r  the  stockholders,"  §  53. 
or  stockholder,  sufficient 
more  persons  to   be  re- 
issets,"  §  58.    A  corpora- 
acres  of  land,  except  that 
jring  companies  may  hold 
>al  companies  ten  thousand 
:  held  in  an  incorporated 
e  to  organize  within  one 
ider  the  general  law,  and  a 
s  by  any  corporation  shall 
Stockholders  may  author- 
cimum  capital  shall  not  be 
ven  for  four  weeks.  Id.  § 
>lders.  Id.  §  17. 
:  their  charter  or  the  gen- 
lefore  business  is  transact- 
)ting  the  provisions  of  this 

poration  Law,  chapter  zxzviii. 


117 


WISCONSIN. 


g  43 


act.     Doing  business  without  compliance  herewith  is  a  misdemeanor, 
ch.  54,  §  30,  as  amended  by  L.  1882,  ch.  97.' 

Taxation. — The  real  estate  of  corporations  is  taxed  the  same  as 
the  realty  of  individuals.  Personal  property,  including  the  actual 
value  of  the  capital  employed,  money,  credits  and  investments  whether 
in  or  out  of  the  state,  less  exemptions  and  the  value  of  real  estate 
which  is  taxed,  and  less  the  debts,  is  taxed  at  the  principal  place  of  busi- 
ness. Individual  stockholders  are  not  taxed,  ch.  29,  §  64.  As  to  rail- 
roads the  auditor  values  the  various  items  of  property.  Only  the  pro- 
perty in  the  state  is  included.  The  auditor  fixes  the  assessment.  A 
state  and  school  tax  is  levied  thereon.  The  gross  valuation  is 
divided  among  the  counties,  school  districts  and  municipalities  through 
which  the  road  passes,  and  the  regular  tax  is  levied  by  each  on  the 
portion  of  gross  valuation  assigned  to  it,  §  67.  All  corporations,  except 
religious,  etc.,  having  a  principal  office  or  their  chief  works  in  the  state, 
must  pay  an  annual  license  fee  of  $10.  Those  having  the  principal 
office  or  chief  works  out  of  the  state  must  pay  an  annual  license  of 
$50,  Act  February  28,  1885,  Code  ch.  32,  p.  233.  $50  and  also  a 
fee  of  $6  is  charged  upon  incorporation,  Id.  and  ch.  54,  §  18. 

11  42,  WISCONSIN.  Constitntional  ProTisions — The  state  shall  not 
give  its  credit  to  aid  corporations.  Art.  VIII.,  §  3.  Corporations  are  to 
be  created  by  general  laws  only,  except  in  the  case  of  banks  or  where  a 
general  law  is  impracticable.  Art.  XL,  §  i.  The  legislature  may 
authorize  or  incorporate  banks  by  general  or  special  laws  only  after  a 
general  election  where  a  majority  of  votes  cast  shall  be  in  favor  of  the 
same,  Art.  XI.,  §  5.  Special  laws  incorporating  companies  are  pro- 
hibited, Amendment  Art.  IV.,  §  31. 

MiscellaneouB  Corporations. — Three  or  more  adult  residents  may  in- 
corporate hereunder  for  "  any  lawful  business  or  purpose,"  except  bank- 
ing, insurance,  building  or  operating  public  railroads,  or  plank  or  turn- 
pike roads,  ch.  220,  Laws  1883,  Suppm't  to  Rev.  Stat.,  p.  382.  Directors, 
must  be  not  less  than  three  and  may  be  elected  to  hold  office  for  three 
years,  Suppm't  to  Rev.  Stat,  p.  384.  The  corporation  shall  not  take  or 
hold  stock  in  another  corporation,  with  certain  exceptions.  Id.  p.  385. 
The  corporation  may  hold  real  property  so  far  as  necessary  for  its 
business  and  in  payment  of  or  security  for  debts,  Id.  No  business  i& 
to  be  transacted  until  half  of  the  capital  stock  is  subscribed  and  twenty^ 
per  cent  paid  in.  Rev.  Stat.  1878,  p.  516.  The  charter  may  be  amended 
by  a  two-thirds  vote  of  the  stockholders.  Id.  pp.  517,  522. 

Railroad  Corporations. — No  officer  shall  be  interested  in  contracts 
with    the  company  or  in  transportation   by  the  company,  or   be  an 

'  Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xli. 

7 


riTT 


I 


IMi! 


42 


WISCONSIN. 


1  8 


officer  in  a  coitipeting  or  parallel  line,  Id.  p.  527.  Five  or  more  may 
incorporate,  Id.  p.  530.  The  stock  must  be  owned  thirty  days  before 
elections,  in  order  to  be  voted.  Each  share  has  one  vote.'  Directors 
must  be  stockholders,  Id.  531.  All  corporate  books  and  papers  are  to 
be  open  to  inspection  at  elections  if  a  majority  of  the  stockholders 
present  so  desire,  Id.  532.  Directors  may  borrow  money  and  give  a 
mortgage.  Id.  534.  A  railroad  may  lease,  purchase  or  consolidate  with 
another  road,  Id.  535,  Suppm't  Rev.  Stat.  408.  Books  are  to  be  open 
to  the  inspection  of  a  committee  of  one-tenth  of  the  stockholders,  Id. 
539.  A  railroad  organized  in  an  adjoining  state  may  build  a  line 
twenty-five  miles  into  this  state  upon  duly  filing  its  charter,  etc.  It 
must  keep  an  office  within  the  state,  L.  1887,  ch.  394.  Conditional 
sales  of  railway  equipments,  as  regards  creditors,  is  regulated  by 
statute,  L.  1883,  ch.  274.  A  railroad  commissioner  has  power  to  inves- 
tigate and  report.  Rev.  Stat.  1878,  p.  523,  etc.,  L.  1889,  ch.  459. 

MIscellaneons  Prorlsions. — Corporations  may  borrow  money  and 
mortgage  their  property  on  the  consent  of  a  majority  of  the  stock- 
holders. Id.  p.  510.'  The  principal  place  of  business  is  to  be  in  the 
state,  and  the  chief  managing  officer  or  superintendent  is  to  reside  in  the 
state,  except  in  the  case  of  inter-state  railroads.  An  annual  statement  of 
the  condition  of  the  company  must  be  filed  for  the  use  of  stockholders. 
Id.  Corporations  have  a  lien  en  stock  for  the  stockholders'  debts,  Id.  p. 
511.*  The  stock  shall  be  issued  only  at  its  par  value  in  money  or 
property  with  certain  exceptions.'  Bonds  may  be  issued  at  not  less 
than  three-fourths  of  the  par  value.*  Stock  dividends  and  fictitious 
stock  are  void.  Id.  p.  511,  Amended  Suppm't,  p.  381."  On  the  for- 
feiture and  sale  of  stock,  the  delinquent  stockholder  is  liable  for  any 
deficiency.  Id.  p.  511.  The  transferer  is  liable  on  an  unpaid  subscrip- 
tion to  creditors  who  were  such  at  the  time  of  transfer  or  within  six 
months  thereafter,  and  is  liable  absolutely  unless  the  directors  waive 
it  and  note  the  waiver  in  the  stock  book,  Id.  p.  512.  Stock  book  is  to 
be  open  to  the  inspection  of  stockholders  and  creditors.  Id.*  No  divi- 
dends are  allowed  until  the  capital  stock  is  fully  paid  in.  Except  in 
railroads,  the  stockholders  are  liable  to  clerks,  laborers,  etc.,  for  six 
months'  service  or  less,  to  an  amount  equal  to  the  stock  held  by  each, 
Id.  p.  514.  Foreign  cor|x>rations  must,  upon  request  of  any  resident 
creditor,  file  a  statement  of  their  capital  stock,  stockholders,  etc.,  and 
also  a  copy  of  their  charter,  Suppm't  p.  382.  Every  stockholder  shall  have 
one  vote  for  each  share.  Rev.  Stat.,  513.     Companies  and  corporations 

'Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  chapter  xIL 
*  U.,  chapter  xxxi.  *  Id.,  chapter  iii.  *  M. 

'  Id.  *  Id.,  chapter  xxx. 


i-,.. 


1  8 


119 


WISCONSIN. 


8  42 


Five  or  more  may 

vned  thirty  days  before 

as  one  vote.'     Directors 

>ooks  and  papers  are  to 

ity  of  t!ie  stockholders 

rrow  money  and  give  a 

lase  or  consolidate  with 

Books  are  to  be  open 

>f  the  stockholders,  Id. 

state  may  build  a  line 

ing  its  charter,  etc.     It 

ch.  394.      Conditional 

ditors,    is   regulated   by 

oner  has  power  to  inves- 

L.  1889,  ch.  459. 

ay    borrow   money    and 

majority  of  the  stock- 

)usiness  is  to  be  in  the 

endent  is  to  reside  in  the 

An  annual  statement  of 

the  use  of  stockholders, 

tockhoiders'  debts,  Id.  p. 

par  value  in  money  or 

y  be  issued  at  not  less 

dividends  and  fictitious 

,  p.  381."      On  the  for- 

holder  is  liable  for  any 

:  on  an  unpaid  subscrip- 

f  transfer  or  within  six 

iless  the  directors  waive  ■ 

,512.     Stock  book  is  to 

creditors,  Id.«    No  divi- 

lly  paid  in.     Except  in 

s,  laborers,  etc.,  for  six 

the  stock  held  by  each, 

request  of  any  resident 

,  stockholders,  etc.,  and 

:ry  stockholder  shall  have 

panies  and  corporations 

>oratioii  Law,  chapter  xIL 


must  have  an  attorney  in  each  county  where  they  do  business,  Suppm't 
to  Code,  p.  380. 

Banks. — By  §§  4,  5,  Art.  XI.  of  the  constitution,  there  is  a  substan- 
tial  reservation  to  the  public  of  all  legislative  power  upon  the  subject  of 
banks  and  banking,  see  12  Wisconsin,  47.  The  banking  law  cannot  be 
amended  without  a  vote  of  the  people,  17  Wisconsin,  645,  46  Id.,  375. 
The  first  banking  act  was  authorized  and  passed  in  1852.  Several  acts 
and  amendments  have  since  been  passed,  but  some  were  not  submitted, 
so  that  there  is  considerable  uncertainty  regarding  some  provisions, 
see  note  p.  444,  Suppm't  to  Rev.  Stat.  Among  the  provisions  of  the 
original  act  are  these  :  Shares  of  stock  are  taxed,  but  not  the  capital, 
Rev.  Stat.  1878,  p.  598.  Associations  for  discount  may  incorporate 
with  a  capital  from  $25,000  to  $500,000,  Id.  599.  May  increase  the 
capital  within  such  limit.  Id.  603.  A  list  of  the  shareholders  is  to  be 
filed.  Id.  604.  Semi-annual  reports  are  to  be  made,  Id.  606.  Stock- 
holders are  liable  for  all  "  debts  to  the  amount  of  their  respective  share 
or  shares,"  Id.  607. 

"An  act  for  the  organization  of  savings  banks  and  savings  socie- 
ties "  was  approved  and  adopted  in  1876.  Twenty  or  more  may  in- 
corporate by  executing  and  filing  a  proper  certificate.  Thtre  shall 
be  at  least  ten  directors.  Not  more  than  three  officers  are  to  be 
officers  in  other  banks.  The  deposit  of  one  person  in  one  year  is  limit- 
ed to  $1,000.  Officers  have  no  compensation  except  the  treasurer  and 
president.  The  bank  is  managed  for  the  benefit  of  depositors.  Officers 
are  not  to  be  sureties  for  borrowers.  Rev.  Stat.  1878,  pp.  610-612. 

Taxation — A  fee  of  $10  is  charged  by  the  secretary  of  state  for 
filing  the  articles,  Suppm't  to  Rev.  Stat.,  p.  384.  Shares  of  stock  in  a 
corporation  in  the  state,  which  pays  taxes  on  its  tangible  property,  are 
exempt.  Rev.  Stat.  1878,  p.  340.  Bank  stock  is  assessed  at  the 
principal  place  of  business  of  the  bank.  Id.  341  and  343.  Railroads 
must  pay  an  annual  license  fee  of  four  per  cent  of  their  gross  earnings, 
also  I5  per  mile  if  the  gross  earnings  exceeds  111,500  per  mile  and 
are  l6ss  than  $3,000,  and  two  per  cent  of  gross  earnings  in  excess  of  the 
$1,500  per  mile,  or  $5  per  mile  if  the  gross  earnings  are  less  Ihati 
$1,500  per  mile.  Id.  p.  389 


CHAPTER  II. 

CONSTITUTIONAL   AND   STATUTORY    PROVISIONS     CF     THE   -TERRITORIES  OK 
THE   UNION    IN    REGARD  TO   CORPORATIONS. 


hSi 


i  43.  Acts  of  Congress  in  regard  to  Corpora- 
rations  in  the  Territories. 

44.  Arizona. 

45.  Idaho. 


g  46.  New  Mexico. 

47.  Utah. 

48.  Wyoming. 


g  43.  Acts  of  Congress  in  regard  to  Corporations  in  the  Territories. — 

Congress  has  power  to  legislate  for  the  territories  and  has  done  so 
on  the  subject  of  corporations.  All  territories  are  prohibited  from  grant- 
ing private  charters  and  special  privileges,  Rev.  Stat,  of  U.  S.,  §  1889.  But 
the  territories  may  enact  general  incorporating  acts  for  '*  mining,  manu- 
facturing, and  other  industrial  pursuits,"  §  1889  ;  also  for  banking,  ch. 
330,  Acts  of  1885.  They  shall  not  grant  the  right  to  lay  down  railroad 
tracks,  nor  grant  any  special  or  exclusive  privilege,  immunity,  or  fran> 
chise  whatever.  No  subscriptions  or  aid  to  any  corporation  by  a  territory 
or  its  municipalities  are  allowed.  The  territories  may  authorize  incor- 
poration for  the  above  purposes,  also  for  insurance,  loans,  trust,  etc.» 
ch.  818,  Laws  1886.  Foreign  corporations  and  domestic  corporations^ 
more  than  twenty  per  cent  of  whose  stock  is  owned  by  foreigners,  shall 
not  purchase  real  estate  in  the  territories.  Corporations  created  in  the 
United  States  shall  not  purchase  more  than  5,000  acres  of  land  in  the 
territories,  except  for  railways,  canals,  or  turnpikes,  ch.  340,  Acts  of 
Congress,  1887. 

^  44.  ARIZONA.  Miscellaneons  Corporations. — Any  number  may 
"  become  incorporated  for  the  transaction  of  any  lawful  business,"^ 
Rev.  Stat..  1887,  g  232.  Unless  articles  of  incorporation  exempt  private 
property,  the  stockholders  are  liable  for  the  debts  of  the  corporation^ 
g  234  (i).  Stockholders  are  always  liable  to  the  amount  of  their 
unpaid  installments,  g  245.  Non-user  of  the  franchise  for  five  year& 
constitutes  a  forfeiture,  g  243.  The  articles  must  be  published  six  days 
in  a  newspaper  in  the  county  where  the  principal  place  of  business  is. 
located,  before  commencing  business.  A  copy  of  such  paper  is  to  be 
filed  with  the  secretary  of  territory  within  three  months,  gg  236,  237. 
Pledgees  shall  not  vote  the  stock  held  in  pledge,  L.  1889,  p.  76. 

As  to  savings  and  loan  corf>orations»  see  gg  283-295. 


191 


IDAHO. 


§  45 


r     THE   TERRITORIES  OK 
NATIONS. 

g  46.  New  Mexico. 

47.  Utah. 

48.  Wyoming. 

lis  in  the  Territories. — 

)ries  and  has  done  so 
prohibited  from  grant- 
it,  of  U.  S.,  §  1889.  But 
:ts  for  '« mining,  manu- 
;  also  for  banking,  ch. 
ht  to  lay  down  railroad 
le,  immunity,  or  fran> 
rporation  by  a  territory- 
may  authorize  incor- 
mce,  loans,  trust,  etc.» 
lomestic  corporations,, 
ed  by  foreigners,  shall 
orations  created  in  the 
acres  of  land  in  the 
>ikes,  ch.  340,  Acts  of 


— Any  number  may 
any  lawful  business,"^ 
oration  exempt  private 
[)ts  of  the  corporation^ 
the  amount  of  their 
anchise  for  five  years 
t  be  published  six  days 
)al  place  of  business  is 
>f  such  paper  is  to  be 
;  months,  §§  236,  237. 
L.  1889,  p.  76. 
^3-295- 


Railroad  Corporations.— Directors  must  be  stockholders,  and  at  least 
two  shall  be  residents  of  the  territory,  but  where  a  majority  of  the 
stock  is  held  in  another  state  or  territory,  the  principal  office  may  be 
in  such  other  state  or  territory,  and  the  meetings  held  therein;  provided 
that  in  such  a  case  an  agent  be  appointed  in  Arizona,  upon  whom  pro- 
cesses and  notices  may  be  served,  §  300.  The  by-laws  must  be  ap- 
proved by  a  majority  of  the  stockholders,  §  304.  A  book  is  to  be  kept, 
called  "  Record  of  Corporation  Debts,"  open  to  the  inspection  of  the 
parties  in  interest,  §  305.  Railroads  may  lease  and  take  leases  of 
other  railroads  and  telegraph  lines,  §g  317,  308.  May  consolidate  upon, 
the  consent  of  three-quarters  of  the  stock  of  each  corporation,  §  317. 
But  co-terminous  competing  roads  cannot  consolidate. 

Foreign  Corporations.— Foreign  corporations  must  file  an  appoint- 
ment of  an  agent  who  must  be  a  do.ta  fide  resident,  and  who  must  not 
be  absent  more  than  three  months,  §  348.  Foreign  corporations  must 
file  a  copy  of  their  charter  with  the  secretary  of  the  territory  and  the 
county  recorder,  §  347.  Foreign  corporations  are  not  to  own  at  one 
time  more  than  320  acres  of  real  estate,  exclusive  of  mines  and  mineral 
lands,  and  land  necessary  or  convenient  for  milling,  smelting,  reduc- 
ing or  working  ores,  or  for  manufacturing  or  commercial  purposes,  §  352. 
Taxation. — All  property  of  corporations  shall  be  taxed,  but  holders 
of  stock  shall  not  be  taxed,  §  2633.  Railroad  property  is  to  be  taxed  on 
its  full  cash  value,  as  assessed  by  a  territorial  board  of  equalization, 
and  the  tax  is  levied  by  the  same  officers  and  for  the  same  purposes  as 
the  property  of  individuals  within  the  counties  and  municipalities,. 
§  2649. 

8  45.  IDAHO.  Mlseellaneons  Corporations. — Corporations  may  be 
formed  for  any  lawful  purpose  by  five  or  more  persons,  a  majority 
of  whom  must  be  bona  fide  residents  of  the  territory,  §§  2576, 
2577.  The  articles  must  be  subscribed  by  at  least  five,  of 
whom  a  majority  must  be  resident  freeholders,  §  2581,  The 
articles  are  to  be  filed  with  the  county  recorder  and  the  secretary  of 
the  territory,  §  2584.  It  must  be  shown  by  affidavit  that  the 
requisite  amount  of  stock  has  been  subscribed,  §  2583.  A  copy  of  the 
articles  must  be  filed  in  all  counties  where  property  is"  to  be  held,  § 
2587.  The  by-laws  must  be  adopted  by  one-half  of  the  stock  voted  at 
a  proper  meeting  or  by  the  written  assent  of  two-thirds  of  the  stock 
without  a  meeting,  §  2588.  They  may  be  altered  by  a  two-thirds  stock 
vote,  or  the  power  may  be  delegated  by  the  same  vote  to  the  directors,. 
§i  2591.  There  shall  be  not  less  than  five  nor  more  than  eleven  direc- 
tors, chosen  from  the  stockholders,  and  a  majority  must  be  "citizens  and 


i      ! 
i  il 

I 


^  46 


NEW  MEXICO. 


199 


actual  bona  fide  residents  within  this  territory,"  g  2599.  Directors  can 
be  removed  from  office  by  a  two-thirds  stock  vote  at  a  meeting  formally 
noticed  and  held,  §  2597.  Stockholders  are  individually  liable  for  all 
•debts  m  proportion  to  the  stock  held,  and  this  applies  to  stockholders 
of  foreign  corporations  doing  business  in  the  territory,  ^  3609.  The 
•company  shall  organize  within  one  year  or  its  powers  cease,  §  2636. 
It  may  acquire  only  such  real  property  as  is  reasonably  necessary  for 
ithe  transaction  of  business  or  the  consttuction  of  its  works,  §  2638. 
Record  and  stock  and  transfer  books  are  to  be  kept  open  for  inspection, 
§8  2639>  2640.  The  right  to  repeal  is  reserved  by  the  legislature  and 
the  legislature  may  dissolve  any  corporation  created  under  this  act,  § 
2641.  Foreign  corporations  must  file  with  the  secretary  of  the  terri- 
itory  and  clerk  of  the  district  court  of  the  county,  a  copy  of  a  designa- 
tion of  a  resident  agent  to  accept  process,  g  2653.  All  meetings  must 
be  held  at  the  principal  office,  g  2606.  "  Corporations  organized  for 
the  purpose  of  acquiring  lands  in  large  tracts,  paying  off  incumbrances 
thereon,  improving  and  subdividing  them  among  the  shareholders,  and 
for  the  accumulation  of  a  fund  for  such  'purposes,  are  known  as 
.homestead  corporations  and  must  not  have  a  corporate  existence  for  a 
longer  period  than  ten  years,"  gg  2720,  2729.  A  foreign  insurance 
■company  must  have  a  paid-up  capital  of  |ioo,ooo  before  it  can 
do  business  in  the  territory,  §  2752.  It  must  obtain  a  certificate  from 
the  treasurer  of  the  territory,  g  2753.  In  default  of  this  it  shall  pay 
a  fine  not  exceeding  $100,  and  there  may  be  an  imprisonment  for  six 
months,  or  both,  g  27593. 

Railroads  may  borrow  money  on  bonds,  notes  and  mortgages  in 
denominations  not  less  than  $500  and  at  a  rate  not  exceeding  ten  per 
cent,  g  2664.  Railroads  may  consolidate  on  the  written  consent  of 
three-fourths  o(  the  stock  upon  due  notice  being  published  for  one 
month  in  one  paper  in  each  county,  §  2673. 

Taxation. — The  capital  stock  of  a  corporation  is  exempt  where  the 
'property  of  the  corporation  has  been  assessed,  g  1401  (6).  All  bank 
stock  is  assessed  against  the  holder  in  the  county  of  the  bank  and  the 
tax  is  paid  by  the  bank.  The  real  estate  of  banks  is  subject  to  territorial, 
•county,  municipal  and  district  taxation  as  other  real  estate,  §  1441. 
Railroad  property  is  taxed  as  other  property,  except  that  the  value  per 
imile  of  the  road  is  assessed  by  the  territorial  board  of  equalization, 
-which  assessment  is  certified  to  the  counties  for  division  and  adjustment 
among  the  municipalities,  etc.,  g  1463.  The  tax  on  both  realty  and 
personalty  is  a  lien  on  the  realty,  gg  1412-1414. 

g  46.  NEW  MEXICO. — Three  or  more  may  incorporate  for  industrial 
jpursuits  "  or  the  construction  or  operation  of  wagon  roads,  irrigating 


ii^Vs-l^ 


123 

259'-  Directors  can 
;  at  a  meeting  formally 
ividually  liable  for  all 
|)plies  to  stockholders 
rritory,  5  3609.  The 
powers  cease,  g  3636. 
sonably  necessary  for 
of  its  works,  §  2638. 
:pt  open  for  inspection, 
)y  the  legislature  and 
ited  under  this  act,  § 
secretary  of  the  terri- 
,  a  copy  of  a  designa- 
53.  All  meetings  must 
orations  organized  for 
lying  off  incumbrances 
the  shareholders,  and 
rposes,  are  known  as 
porate  existence  for  a 

A  foreign  insurance 
10,000  before  it  can 
btain  a  certificate  from 
lit  of  this  it  shall  pay 
I  imprisonment  for  six 

[)tes  and  mortgages  in 

not  exceeding  ten  per 

the  written  consent  of 

ing  published  for  one 

>n  is  exempt  where  the 
g  1401  (6).  All  bank 
y  of  the  bank  and  the 
is  subject  to  territorial, 
er  real  estate,  §  1441. 
:ept  that  the  value  per 
board  of  equalization, 
livision  and  adjustment 
IX  on  both  realty  and 

corporate  for  industrial 
ragon  roads,  irrigating 


198 


VKW  MEXICO. 


§  46 


ditches  or  the  colonization  and  improvement  of  land  in  connection 
therewith"  and  other  pur|>ose8,  Compiled  Laws  1884,  ^  19a,  193,  and 
see  ch.  loi,  L.  1889.  The  secretary's  fee  for  filing  the  first  certificate  is 
$5,  Id.  It  must  also  be  filed  with  the  county  probate  clerk,  Id.  The 
time  of  existence  is  limited  to  fifty  years,  Id.  The  directors  are  to  be 
not  less  than  three.  They  must  be  stockholders,  a  majority  must  be 
•citizens  of  the  United  States,  and  at  least  one-third  must  be  residents 
of  the  territory,  g  196.  The  indebtedness  is  limited  to  the  amount  of 
the  .capital  stock  and  the  directors  are  liable  for  the  excess,  g  205.  A 
corporation  in  a  contiguous  state  or  territory  must  file  copies  of  its  articles 
with  the  secretary  of  the  territory  and  the  county  probate  clerk  before 
extending  its  wagon  or  rail  road,  or  telegraph  lines  into  the  territory, 
§  215.  Directors  may  be  removed  by  a  two-thirds  vote  of  all  the  di- 
rectors and  the  vote  of  the  stockholders,  §195. 

Foreign  corporations  must  file  a  copy  of  their  charter  with  the 
secretary  of  the  territory  and  the  recorder  of  deeds  of  the  county  where 
the  principal  office  in  the  territory  is  located,  and  also  a  certificate 
designating  this  place  of  business  and  an  agent  to  accept  process. 

Incumbrances  are  limited  and  local  creditors  are  preferred,  g  218. 

A  failure  to  file  the  certificates  and  copies  of  charters  renders  all 
liable  as  partners,  §  219. 

A  record  of  the  stockholders  is  to  be  kept  open  to  stockholders  and 
creditors,  g  224.  "Corporations  may  be  formed  ?nd  may  do  business 
in  this  territory  ...  to  acquire,  hold,  improve,  develop  and  man- 
age any  hot,  mineral  or  other  sanitary  spring,  or  to  lay  off  land  into 
town  sites,  etc.,  .  .  .  and  to  acquire,  hold,  colonize,  improve  and 
sell  lands  in  connection  with  any  or  all  of  said  objects,"  g  226.  Shares 
of  slock  are  personal  property,  g  200.  They  may  be  sold  under  attach- 
ment,  g  227.  "  Transfers  of  stock  after  the  levy  of  an  attachment  or 
after  judgment  and  with  notice  to  the  corporation  of  the  levy  or  judg- 
ment, are  absolutely  void.  If  the  shares  be  in  a  railroad,  canal,  turn- 
pike, allquia,  or  plank  road  company  or  corporation,  they  may  be  levied 
on  and  sold  in  any  county  through  which  the  same  passes,"  g  228. 
Where  a  majority  of  the  stock  is  held  in  another  state  or  territory  the 
principal  office  may  be  in  such  other  state  or  territory  and  meetings 
may  be  held  there,  provided  an  office  and  agent  shall  be  designated 
within  New  Mexico  as  prescribed  in  case  of  foreign  corporations,  g  230. 

Errors  in  incorporating  ihay  be  corrected  by  a  new  certificate,  ch. 

74,  L.  1889. 

The  corporation  may  do  its  business,  hold  land,  etc.,  anywhere  in  or 
out  of  the  United  States,  ch.  82,  L.  1889. 

The  period  of  existence  of  corporations  may  be  extended,  ch.  93, 
L.  1889. 


f. 


:  . 


nK^^-' 


8  4T 


UTAH. 


124 


As  to  insurance  companies  see  ch.  loa,  L.  1889. 

As  to  building  ami  loan  associations,  seech.  108,  L.  1889. 

RallroadH. — Railroads  may  be  incorporated  by  five  or  more  persons, 
citizensof  the  United  States,  §  363a,  and  see  ch.  10;,  L.  1889.  By-laws 
are  to  be  adopted  by  a  majority  stock  vote,  g  3630.  And  changed  by  a 
two-thirds  stock  vote,  or  the  power  to  change  may  be  delegated  to  direc- 
tors by  a  two-thirds  stock  vote,  g  363a.  At  least  $1,000  a  mile  must 
be  subscribed  and  ten  percent  paid  in,  §  jd'ts.  Directors  must  be  stock- 
holders and  citizens  of  the  United  States,  §  3633.  They  may  be  re- 
moved by  a  two-thirds  vote  of  all  the  stock,  §  3638.  "  The  meetings 
of  stockholders  and  board  of  directors  must  be  held  at  the  office  or 
principal  place  of  business  of  the  corporation,"  g  3647.  A  "  record  of 
corporation  debts,"  also  a  ••  book  of  stockholders,"  also  "  a  transfer 
book,"  are  always  to  be  kept  open  to  stockholdeis  and  creditors.  An- 
other book  is  to  contain  a  record  of  proceedings  at  stockholders  and 
directors*  meetings,  and  this  is  to  be  of<en  to  inspection,  g  3650.  A 
married  woman  may  sell  and  vote  her  stock  as  though  a  feme  sole,  g 
2653.  A  railroad  may  be  leased  to,  or  .nay  take  a  lease  of  another  rail- 
road, g  3665,  15th  and  i6th.  Railroads  i/ay  consolidate  upon  a  three- 
fourths  vote  of  the  stock  of  each  corpcraticn,  g  2653,  19th.  Subscrip- 
tions to,  leases,  sales  and  consolidations  of  one  railroad  to  or  with  an- 
other are  regulated  and  allowed  on  a  two-thirds  vote  of  all  the  stock, 
gg  3700-3708.  Counties  may  aid  railroads,  gg  2709-3713.  One-fourth 
of  the  directors  must  be  residents,  g  3728. 

Banks. — The  capital  stock  must  be  at  least  $30,000,  g  143.  A 
stockholder  cannot  vote  if  he  has  debts  due  to  the  bank,  g  144.  Stock- 
holders are  individually  liable  to  the  extent  of  their  stock  in  addition  to 
the  subscription  price,  but  such  liability  ceas  -  '^ne  year  after  a  transfer, 

§  »So. 

Taxes. — The  property  of  the  corporation  is  assessed  where  the 
property  is  situated.  If  the  entire  capital  or  property  is  assessed,  the 
stockholder  is  not  subject  to  taxation,  g  3815.  Shares  of  stock  are  as- 
sessed at  their  cash  value,  g  3818.  Railroads  are  exempt  from  taxation 
for  six  years  after  completion,  gg  3691-3699. 

g  47.  UTAH. — Five  or  more,  one -third  being  residents,  may  incor- 
porate for  any  "  industrial  pursuit,"  or  *'  for  any  rightful  subject  con- 
sistent with  the  constitution  of  the  United  States,  and  the  laws  of  thi» 
territory,"  Compiled  L.  1888,  g  3367.  The  articles  of  association,  which 
must  be  acknowledged  before  a  probate  judge,  are  to  provide  for  the 
removal  and  resignation  of  officers,  also  "  whether  the  private  property  of 
the  stockholders  shall  be  liable  for  its  obligations  or  not,  with  such 


124 


125 


UTAH. 


8  47 


o8,  L.  1889. 
five  or  more  persons, 
10;,  L.  1889.  By-laws 
0.  And  changed  by  a 
be  delegated  to  direc- 
it  $1,000  a  mile  must 
rectors  must  be  stock- 
J3.  They  may  be  re- 
S38.  •*  The  meetings 
e  held  at  the  office  or 
2647.  A  "  record  of 
rs,"  also  "  a  transfer 
i  and  creditors,  An- 
at  stockholders  and 
isptction,  g  2650.  A 
though  a  feme  sole,  g 
t  lease  of  another  rail- 
solidate  upon  a  three- 
653.  19th,  Subscrip- 
railroad  to  or  with  an- 
1  vote  of  all  the  stock, 
09-2712.    One-fourth 

it  $30,000,  §  142.  A 
!  bank,  g  144.  Stock- 
ir  stock  in  addition  to 
s  year  after  a  transfer, 

s    assessed  where  the 
operty  is  assessed,  the 
hares  of  stock  are  as- 
exempt  from  taxation 


residents,  may  incor- 
rightful  subject  con- 
I,  and  the  laws  of  thi» 
;s  of  association,  which 
ire  to  provide  for  the 
the  private  property  of 
ns  or  not,  with  such 


additional  clauses  as  they  deem  necessary  for  the  conducting  of  the 
business  and  its  future  safety  and  wclfart-."     An  oath  ur  affirmation  as 
to  good  faith  shall  be  made  by  at  least  three  and  the  acknowledgment 
■hall  not  be  made  before  the  probate  judge  until  ten  per  cent  of  each 
subscription  has  been  paid  in.     The  entire  capital  stock    may  be  sub- 
scribed in  property  at  a  fair  estimated  cash  value,  but  the  articles  must 
state  that  fact  and  describe  the  property,  g  2268.     The  articles  must  be 
filed  with  the  probate  clerk  within  ten  days  after  their  execution,  g  2269. 
The  officers  must  take  an  oath  and  file  a  bond  to  the  effect  that  they 
will  discharge  their  duties  and  will  not  defraud  the  stockholders,  %  2270, 
A  certificate  is  then  issued  by  the   probate  clerk  which  must  be  filed 
with  the  secretary  of  the  territory,  who  issues  a  certificate  of  incorpo- 
ration, J5  3271.     The  corporation  shall  have  power  to  buy  real  estate 
necessary  for  its  general  business,  and  the  collection  and  security  of  its 
debts,  but  shall  not  engage  in  the  real  estate  business.     By-laws  "may 
be  made  in  a  general  meeting  of    the  stockholders  or  by  a  board  of 
officers  elected  by  them."     Directors  shall  be  stockholders  and  one- 
third  of  them  residents,  §  2272.     The  capital  stock  may  be  increased 
to  $20,000,000  or  diminished  to  any  amount  not  less  than  twenty-five 
per  cent  in  excess  of  the  indebtedness.      The   name,  number  of  di- 
reccors  or  articles  may  be  changed  by  a  two-thirds  stock  vote  at  a 
special  meeting.       Two  or  more  corporations   formed  under  this  act 
may  consolidate  upon  a  two-thirds  vote  of  the  stockholders  "  at  a  regular 
meeting    of    said    corporation."      Notice    of     such    meetings    must 
be  published  thirty  days  in  a  Salt    Lake ,  City    newspaper,  g  2273. 
Dissolution   may   be  had  upon  a  two-thirds  vote  if  approval  by  the 
probate  judge  of  the  county,  §  2274.  A  corporation  "  shall  have  a  lien 
on  the  amount  paid  in  and  the  dividends  thereon  for  any  balance  due 
for  the  stock  of  a  delinquent  stockholder,"  g  2276.      Keeping  false 
books  with  intent  to  deceive  is  declared  a  crime,  g  2281.    Non-user  for 
two  years  forfeits  the  corporate  privileges,  g  2284.     "At  all  meetings 
each  shareholder  shall  be  entitled  to  one  vote  for  each  share  of  stock." 
Proxies  are  permitted,  §  2285.     There  is  no  personal  liability  of  stock- 
holders unless  the  articles  so  provide  ;  but  "  the  joint   property  of  the 
association  and  the  unpaid  stock  shall  be  liable  for  the  debts  of  the 
association,"  g  3386. 

Foreign  Corporations. — Those  doing  business  in  the  territory  are  re- 
quired to  file  copies  of  their  articles  and  certificates  of  incorporations 
and  designate  a  resident  agent,  upon  whom  services  of  papers  may  be 
made.  If  they  fail  to  do  so,  the  statute  of  limitations  does  not  run  in 
their  favor,  g  3293. 

Ballroads. — Ten,  or  more,  two-thirds  being  residents  and  all  being 


§  48 


WYOMING, 


129 


Stockholders  may  incorporate,  §  2315.  Directcs  are  chosen  by  a  ma- 
jority vote  of  the  stockholders,  §  2322.  They  may  be  removed,  as  also 
the  president,  at  a  properly  noticed  meetin^j  if  two-thirds  in  interest 
are  present,  §  2324.  Directors  may  make  the  by-laws,  §  2336.  A  book 
containing  '*  all  written  contracts  of  the  directors,  and  a  succinct  state- 
ment of  the  debts  of  the  company,  the  amount  thereof,  and  to  whom 
due,"  shall  during  business  hours  be  open  to  stockholders  or  parties^ 
interested,  §  2327.  So  also  as  to  the  book  of  stockholders,  §  2328. 
Railroads  may  consolidate  with  railroads  in  any  state  or  other  territory 
by  a  vote  of  two-thirds  of  the  stockholders  at  a  meeting  duly  noticed,, 
and  the  ratification  of  the  agreement  may  be  in  the  mode  prescribed  in 
the  other  state  or  territory,  §§  2360-2361.  The  lease  of  one  railroad  tO' 
another  is  authorized,  §  2367.  Railroad  corporations  may  be  formed 
for  the  purpose  of  buying  any  railroad  property  at  a  mortgage  or  private 
sale,   in   this  territory  when  the  same  is  to  be  sold  under  a  trust  deed, 

§  2373- 

Banking. — By   L.    1888,   ch.   46,  six  or  more  persons,  two-thirds. 

being  residents,  may  incorporate.  The  capital  varies  with  the  popula- 
tion, but  is  not  to  be  less  than  $25,000.  Shareholders  are  liable  equally 
and  ratably  to  the  amount  of  their  stock  at  its  par  value  in  addition  to  the. 
amount  invested  in  and  due  on  the  shares.  Twenty-five  percent  of  the 
capital  must  be  paid  before  commencing  business.  Compiled  L.  1888,, 
§§2494-2519. 

Telegraph  Companies.— See  L.  1884,  pp.  86-92,  Compiled  L.  1888,  §§• 
2294-2314. 

Tax«j^ion.— Shares  of  stock  are  exempt,  when  the  corporate  property 
is  taxed,  §  2009.  Shares  of  stock  in  national  banks  are  taxed  against  the 
holder.  Shares  of  stock  in  other  corporations,  when  taxable,  are  taxed 
in  the  county  where  the  stockholder  resides,  §  2011.  Corporate  realty 
and  personalty  are  taxed  as  though  belonging  to  individuals,  §  2013. 
Railroads  are  taxed  on  their  realty,  personalty,  and  a  proportion  of  the 
rolling  stock,  by  each  county  containing  it,  according  to  a  report  of  the 
railroad  itself,  §  2015. 

The  territorial  secretary's  fees  for  filing  the  papers  of  incorporation,, 
and  issuing  a  certificate  of  incorporation,  are  $5  and  $3  respectively, 
§  54SS- 


,!'; 


§  48.  WYOMING. — Three  or  more  may  incorporate  to  carry  01* 
"any  branch  of  business  designed  to  aid  in  the  industrial  or  productive 
interest  of  the  country,"  Rev.  Stat.  1887,  §  501.  If  the  corporation  is 
formed  for  business  to  be  done  outside  the  territory  the  certificate  shall 
so  state,  as  also  the  principal  place  of  business  within  the  territory^ 


126: 

cto's  are  chosen  by  a  ma- 

inay  be  removed,  as  also 

if  two-thirds  in  interest 

by-laws,  §  2336.  A  book 

tors,  and  a  succinct  state- 

int  thereof,  and  to  whom 

stockholders  or  parties 

of  stockholders,  §   2328. 

ny  state  or  other  territory 

a  meeting  duly  noticed,, 

n  the  mode  prescribed  in 

he  lease  of  one  railroad  to 

>orations   may  be  formed 

|r  at  a  mortgage  or  private 

B  sold  under  a  trust  deed, 

more  persons,  two-thirds. 
1  varies  with  the  popula- 
lolders  are  liable  equally 
lar  value  in  addition  to  the 
venty-five  per  cent  of  the 
piness,  Compiled  L.  1888,, 

-92,  Compiled  L.  1888,  §J 

;n  the  corporate  property- 
inks  are  taxed  against  the 
;,  when  taxable,  are  taxed 
2011.  Corporate  real  t)r 
g  to  individuals,  §  2013. 
,  and  a  proportion  of  the 
lording  to  a  report  of  the 

papers  of  incorporation^ 
:  $5  and  $3  respectively, 


incorporate  to  carry  on 
e  industrial  or  productive 
)i.  If  the  corporation  i& 
itory  the  certificate  shall 
I'ss  within  the  territory^ 


127 


WYOMING. 


8  48: 


§  504.  There  shall  be  not  less  than  three  nor  more  than  nine  trustees, 
all  stockholders,  §  505,  By-laws  are  to  be  made  by  the  stockholders 
or,  if  the  charter  so  provides,  by  the  trustees,  §  509.  The  ci^mpany  can- 
not purchase  shares  of  its  own  stock  or  the  stock  of  otiier  corporations,. 
§  510.  Stockholders  are  liable  only  for  unpaid  assessments,  §  512. 
The  legislature  reserves  authority  over  corporations,  §  518.  The 
trustees  are  liable  for  any  excess  of  debts  over  the  capital,  §  523.  A 
statement  of  affairs  is  to  be  made  on  the  request  of  fifteen  per  cent  of 
the  stockholders,  §  524.  The  company  may  hold,  purchase  and  convey 
such  real_and  personal  estate  as  the  purposes  of  the  corporation  may  re- 
quire, §  543.  All  meetings  of  stockholders  shall  be  held  within  the  terri- 
tory, §   643. 

Railroads  may  issue  bonds  in  sums  not  less  than  $1,000  and  at  a 
rate  of  interest  not  greater  than  ten  per  cent.  They  shall  not  plead 
usury,  §  549.  Connecting  railroads  may  consolidate  upon  the  agree- 
ment of  the  trustees,  provided  that  all  stockholders  so  desiring  shall  be 
paid  an  appraised  value  of  their  stock  at  the  date  of  the  consolidation,. 
§  550.  The  consolidation  is  consummated  by  filing  a  duplicate  of  the 
agreement,  §  551.  And  no  deed  or  transfer  is  necessary  to  transfer  all 
rights.  The  agreement,  however,  shall  not  affect  fhe  creditors  nor  the 
duties  of  the  respective  corporations,  §  552.  A  railroad  company  may 
subscribe  to  the  capital  stock  of  other  railroad  companies,  §  553.  A 
railroad  company  may  lease  or  sell  all  or  part  of  itself  to  another  rail- 
road company,  or  perfect  arrangements  with  a  connecting  railroad  for 
their  common  benefit,  §  554. 

Foreign  corporations  shall  file  their  certificates  or  charters  with  the 
secretary  of  the  territory  and  the  register  of  deeds,  §  600.     All  officers, 
and  stockholders  are  liable  in  case  of  failure  so  to  do,  §  601.     The  fee 
for  filing  is$i  for  each  certificate,  statute  or  charter,  §  602. 

Taxation. — AH  real  and  persbnal  property  within  the  territory 
belonging  to  or  claimed  by  any  incorporated  company,  whether  incorpo- 
rated in  the  territory  or  not,  is  taxed,  §  3776.  Shares  of  stock  shall  also, 
be  taxed,  Id.  National  bank  shares  are  assessed  at  their  par  value  and 
are  taxable  the  same  as  state  bank  shares,  §  3789.  Bank  notes  and  other 
corporation  stocks  are  assessed  at  their  cash  value,  §  3791.  Railroadi 
property  is  assessed  on  the  verified  statement  of  the  pr-ncipal  officers, 
by  a  territorial  board  of  equalization  at  so  much  per  mile.  This  ia. 
certified  to  the  several  counties  and  there  sub-apportioned,  §  3839. 


CHAPTER  III. 

CONSTITUTIONAL   AND   STATUTORY    PROVISIONS  OF  THE   FEDERAL   GOV- 
ERNMENT   AFFECTING    CORPORATIONS. 


!§  49.     No  State  fihall  pass  a  law  "  impairing  the  obligation  of  contracts." 

50.  Congress  shall  have  power  "  to  regulate  comnierce  with  foreign  nations 
and  among  the  several  states." 

51.  "  The  citizens  of  each  state  shall  be  entitled  to  all  privileges  and  immuni- 
ties of  citizens  in  the  several  states." 

52.  Jurisdiction  of  |he  United  States  Courts  in  cases  affecting  corporations. 

53.  No  state  shall  "  deprive  any  person  of  life,  liberty,  or  property,  without 
due  process  of  law;  nor  deny  to  any  person  within  its  jurisdiction  the  equal 
protection  of  the  laws." 

54.  Corporations  created  by  the  United  States. 

55.  National  banks. 

56.  The  Inter-state  Railway  A£t. 

§  49.  No  stato  shall  pass  a  law  "  Impaliing  the  obligation  of  contracts," 

Art.  I.,  §  9.  This  provision  has  given  rise  to  a  large  number  of  de- 
cisions both  in  the  state  and  federal  courts.  Great  difficulty  has  been 
found  in  fixing  the  limit  where  the  legislative  power  of  the  state  end" 
and  where  the  application  of  the  above  provision  begins.  Formerly  the 
federal  courts  favored  a  restriction  of  the  legislative  power  and  an  ex- 
pansion of  this  constitutional  provision.  But  of  late  years  the  contrary 
tendency  has  prevailed  and  has  led  to  the  decisions  in  the  "  Granger 
Cases."  The  growth,  application  and  extent  of  this  constitutional 
provision  may  be  seen  from  the  following  decisions,  which  are  given 
in  chronological  order : 

A  college  charter  granted  by  the  King,  previous  to  the  American 
independence,  is  a  contract  which  cannot  be  amended  or  changed  by 
the  legislature  of  the  state  in  which  the  college  exists.  Trustees  of 
Dartmouth  College  v.  Woodward,  4  Wheat.,  463  (1819).  The  voluntary 
surrender  of  a  charter  and  a  dissolution  under  a  statute  passed  subse- 
quently to  the  granting  of  the  charter  is  not  a  violation  of  contract  as 
regards  corporate  creditors,  Mumma  t.  Potomac  Co.,  8  Peters,  381 
{1834).  A  charter  granting  to  a  corporation  the  right  to  take  tolls  at  a 
ferry  does  not  prevent  the  granting  of  a  subsequent  charter  to  another 
corporation  to  establish  a'  rival  ferry,  Charles  River  Bridge  v.  Warren 
Bridge,  11  Peters,  420  (1837).  An  exemption  of  corporate  lands  from 
state  taxation  does  not  exempt  the  lands  from  taxation,  after  the  corpo- 
ration   has    sold   it,  Armstrong  v.   Treasurer,    etc.,  16    Peters,  381 


— --  -                           ■    ll'l 

/ 

OF  THE   FEDERAL   GOV- 

VTlOtiS. 

ation  of  contracts." 

merce  with  foreign  nations 

' 

■ 

all  privileges  and  immuni- 

i 

m 

es  affecting  corporations, 
berty,  or  property,  without 
bin  its  jurisdiction  the  equal 

1 
1 

■A 

» obligation  of  contracts,'* 

a  large  number  of  de- 
rreat  difficulty  has  been 
power  of  the  state  end«! 
n  begins.  Formerly  the 
lative  power  and  an  ex- 
f  late  years  the  contrary 
:isions  in  the  "  Granger 
t  of  this  constitutional 
cisions,  which  are  given 

!vious  to  the  American 
mended  or  changed  by 
liege  exists,  Trustees  uf 
3  (1819).  The  voluntary 

a  statute  passed  subse- 
iriolation  of  contract  as 
mac  Co.,  8  Peters,  281 
le  right  to  take  tolls  at  a 
uent  charter  to  another 

River  Bridge  v.  Warren 
of  corporate  lands  from 
taxation,  after  the  corpo- 
■,    etc.,  16    Peters,  381 


129 


FEDERAL  CONSTITUTION, 


§49 


(1842).  An  exemption  of  a  corporation  from  taxation  is  violated  by  a 
tax  on  the  shares  of  stock.  Although  the  corporate  charter  expires  and 
is  renewed,  the  exemption  is  not  necessarily  renewed,  Gordon  v.  Ap- 
peal Tax  Cour*^  z  How.,  133  (1844),  A  penalty  incurred  by  a  corpo- 
ration may  be  released  by  the  statt  since  it  is  not  a  contract  within  the 
above  provision,  State  of  Maryland  7>.  Baltimore  and  Ohio  Railroad 
Co.,  3  How.,  534  (1844).  The  above  constitutional  provision  does  not 
prevent  the  state  from  authorizing  the  condemnation  of  corjTOrate  prop- 
erty or  franchises  under  its  power  of  eminent  domain.  That  power  can- 
not be  contracted  away.  West  River  Bridge  Co.  r.  Dix,  6  How. ,  507 
(1847).  A  state  may  enact  a  law  retrospectively  authorizing  banks  to 
sue  on  notes  payable  to  their  cashiers,  Crawford  v.  Branch  Bank,  etc., 
7  How.,  279  (1848).  An  agreement  of  the  state  to  accept  the  bills  of 
a  corporation  in  payment  of  debts  due  to  the  state  cannot  be  repealed, 
Woodruff  z/.  Trapnall,  10  How.,  190  (1850).  The  legislature  may  pass 
a  statute  vacating  condemnation  proceedings  which  have  not  been  fully 
completed,  Baltimore  and  S.  Railroad  Co.  v.  Nesbit,  10  How., 
395  (1850).  A  railroad  charter  stipulating  that  no  other  charter 
shall  be  granted  for  a  railroad  within  a  certain  distance  so  as  to  affect 
the  former  road's  passenger  traffic  is  not  violated  by  a  charter  to  a  rail- 
road to  transport  merchandise,  Richmond,  etc..  Railroad  Co.  v.  Loui- 
siana Railroad  Co.,  13  How.,  71  (1851).  J.and  granted  to  and  accept- 
ed by  a  private  corporation,  aninstitutionof  learning,  cannot  afterwards 
be  retaken  by  the  state  granting  it,  Vincennes  University  v.  State  of 
Indiana,  14  How.,  268  (1852).  A  statute  taking  from  corporate  credit- 
ors of  an  insolvent  corporation  the  right  to  its  assets  and  depriving 
them  of  remedies  against  the  corporate  property  is  unconstitutional, 
Curran  v.  State  of  Arkansas,  15  How.,  304  (1853).  An  exemption  from 
all  taxation  other  than  a  prescribed  tax  on  profits  is  a  contract  that 
cannot  be  broken,  State  Bank  of  Ohio  v.  Knoop,  16  How.,  369  (1853). 
Such  is  the  law,  even  though  the  additional  tax  is  imposed  by  a  new 
constitution  of  the  state.  Dodge  v.  Woolsey,  18  How.,  331  (1855). 
Where  a  county  had  voted  a  subscription  to  a  railroad  under  a  statute 
authorizing  the  subscription,  and  the  .constitution  of  the  state  was 
amended  after  the  vote,  but  before  the  subscription  was  made,  it  was 
held  that  the  constitutional  amendment  prohibiting  such  subscriptions 
invalidated  this  one,  Aspinwall  v.  Commissirners  of  Davies  County, 
22  How.,  364  (1859),  <■/•  ^"^-  A  statutory  exemption  of  corporate 
property  from  taxation,  made  after  incorporation  and  without  consider- 
ation, may  be  repealed.  It  is  not  a  contract.  Rector,  etc.,  Christ 
Church  V.  County  of  Philadelphia,  24  How.,  300  (i860).  A  case  in- 
volving substantially  the  same  Tacts  as  those  of  State  Bank  v.  Knoop. 


49 


FEDERAL   CONSTITUTION. 


130 


supra,  was  similarly  decided  in  Jefferson  Branch  Bank  v.  Skelly, 
I  Black.,  436  (i86i).ls  o  in  Franklin  Branch  Bank  v. State  of  Ohio, 
Id.  474  (1861).  The  above  constitutional  provision  protects  bond- 
holders secured  by  a  lien  on  a  canal.  The  state  cannot  post- 
pone the  priority  of  that  lien,  Wabash,  etc.,  v.  Beers,  2  Black.,  44S 
(1862).  An  exclusive  right  to  "bridge"  a  river  is  not  violated  by  the 
subsequent  construction  of  a  railroad  bridge  by  another  company. 
Bridge  Property  v.  Hoboken  Co.,  i  Wall.,  116  (1863).  The  individual 
liability  of  stockholders  cannot  be  repealed,  so  as  to  lessen  the  security 
of  corporate  debts  existing  at  the  time  of  the  repeal,  Hawthorne  v. 
Calef,  2  Wall.,  10  (1864.)  A  charter  clause  that  no  other  bridge  within 
a  certain  distance  shall  be  built  is  protected.  The  Binghamton  Bridge, 
3  Wall.,  51  (1865).  A  state  may  grant  a  subsequent  charter  though  its 
use  destroys  the  profits  of  a  previous  charter  to  another  competing  com- 
pany^ Turnpike  Company  v.  State,3  Wall.,  210(1865).  A  state  authoriz- 
ing a  county  to  issue  bonds  to  aid  a  railroad  cannot  afterward  withdraw 
the  taxation  powers  of  a  county  to  pay  the  bonds,  Van  Hoffman  v.  City 
of  Quincy,  4  Wall.,  535  (1866).  Furman  v.  Nichol,  8  Wall.,  44  (1868) 
is  practically  the  same  case  as  Woodruff  v.  Trapnall,  supra.  A  charier 
exemption  from  taxation,  the  charter  stating  that  the  right  to  repeal  or 
amend  the  charter  should  not  exist,  is  an  inviolable  contract,  Home  of 
the  Friendless  v.  Rouse,  8  Wall.,  430  (1869),  and  Washington  University 
V.  Rouse,  Id.  439.  Under  a  reserved  right  to  amend  or  repeal,  the 
state  may  consolidate  two  college  corporations,  especially  where  the  con- 
solidation is  accepted  by  the  trustees  of  both,  Pennsylvania  College 
Cases,  13  Wail.,  190  (1871).  A  charter  exemption  from  taxation  cannot 
be  violated  by  a  subsequent  statute,  Wilmington  Railroad  v.  Reid,  1*^ 
Wall.,  264  (1871).  A  bounty  of  money  and  of  exemption  from  taxation 
to  individuals  or  corporations  manufacturing  salt  is  repealable  at  any  time. 
Salt  Company  v.  East  Saginaw,  13  Wall.,  373  (1871).  Foreign-held 
bonds,  secured  by  a  mortgage  on  a  domestic  railroad  corporation,  cannot 
be  taxed  by  the  state.  Case  of  the  State  Tax  on  Foreign-held  Bonds, 
15  Wall.,  300  (1872).  Under  the  reserved  power  to  amend  or  repeal, 
an  exemption  of  a  corporation  from  taxation  may  be  repealed,  Tomlin- 
son  V.  Jessup,  15  Wall.,  454  (1872).  Upon  the  consolidation  of  two 
roads,  the  rights  of  exemption  from  taxation  previously  existing  continue 
to  apply  to  the  property  of  each,  but  the  exemption  of  one  does  not 
thereby  extend  to  the  property  of  the  otl  .r.  The  consolidation  makes 
no  change  as  regards  the  exemptions,  Tomlinson  v.  Branch,  15  Wall., 
460  (1872).  A  statute  giving  to  a  municipality  a  certain  representation 
in  the  board  of  directors  of  a  railroad  corporation,  may,  under  the 
state's   reserved   right   to  amend   or  repeal,    be   changed  giving  the 


<r. 


180 


181 


FEDERAL  CONSTITUTION. 


§  49 


Branch    Bank  v.  Skelly, 
;h  Bank  v.  State  of  Ohio, 
irovision   protects  bond- 
rhe  state    ctinnot    post- 
,  V.  Beers,  2  Black.,  448 
:r  is  not  violated  by  the 
:  by   another  company, 
(1863).     The  individual 
I  as  to  lessen  the  security 
e  repeal,  Hawthorne  v. 
at  no  other  bridge  within 
'he  Binghamton   Bridge^ 
equent  charter  though  its 
I  another  competing  com- 
^1865).  A  state  authoriz- 
annot  afterward  withdraw 
ids,  Van  Hoffman  v.  City 
chol,  8  Wall.,  44  (i868> 
ipnall,  supra.     A  charter 
at  the  right  to  repeal  or 
able  contract,  Home  of 
id  Washington  University 
o  amend   or  repeal,   the 
especially  where  the  con- 
h,  Pennsylvania   CoUege 
;ion  from  taxation  cannot 
on  Railroad  v.  Reid,  i:i, 
exemption  from  taxation 
t  is  repealable  at  any  time, 
3   (1871).     Foreign-held 
ilroad  corporation,  cannot 
on   Foreign-held  Bonds, 
power  to  amend  or  repeal, 
nay  be  repealed,  Tomlin- 
the  consolidation  of  two 
eviously  existing  continue 
temption  of  one  does  not 
The  consolidation  makes 
ison  V.  Branch,  15  Wall., 
'  a  certain  representation 
joration,   may,  under  the 
be   changed  giving  the 


municipality  a  greater  representation,  Miller  v.  State,  13  Wall.,  478 
(1872).  Corporations,  building  a  bridge,  may  subsequently  be 
required  to  build  a  fish  dam  for  migratory  fish,  Holyoke 
Co.  V.  Lyman,  13  Wall.,  500  (1872).  An  exemption  of  a  corpora- 
tion from  taxation  is  inviolable,  Humphrey  v.  Pegues,  16  Wall.,  244 
(1872).  A  state  cannot  direct  the  assets  of  an  insolvent  bank  to  be 
applied  to  the  payment  of  state  debts.  The  assets  belong  to  the  bank's 
creditors.  Barings  v.  Dabney,  19  Wall.,  i  (1873).  -^"  exemption  of  a 
corporation  from  taxation  cannot  be  violated,  Pacific  Railroad  Company 
V.  Maguire,  20  Wall.,  36  (1873).  A  creditor  of  a  corporation,  whose 
stockholders  are  individually  liable,  cannot  hold  individually  liable  the 
subscribers  to  new  stock,  issued  after  a  constitutional  amendment  pro- 
viding against  individual  liability,  Ochiltree  v.  Railroad  Company,  21 
Wall.,  249  (1874).  An  exemption  of  a  corporation  from  taxation,  granted 
by  a  gratuitous  amendment  to  the  charter  is  repealable,  Tucker  v.  Fergu- 
son, 22  Wall.,  527  (1874).  A  vote  of  the  county  authorities  making  a 
railroad  subscription  and  authorizing  the  issue  of  bonds  therefor,  under 
statutory  power,  is  a  contract  and  is  not  affected  by  a  subsequent  con- 
stitutional provision  prohibiting  such  acts,  even  though  the 
actual  subscription  was  never  made  and  the  bonds  were: 
issued  after  the  constitutional  amendment.  County  of  Moultrie. 
V.  Rockingham,  etc..  Bank,  92  U.  S.,  631  (1875).  A  license  to> 
a  foreign  corporation  to  do  business  does  not  prevent  taxation 
of  it,  Home  Ins.  Co.  v.  City  Council,  93  Wall.,  116  (1876).  The  case, 
West.,  etc.,  R'y  Co.  v.  Supervisors,  93  U.  S.,  595  (1876),  is  substan- 
tially the  same  as  Tucker  v.  Ferguson,  supra.  The  reserved  right 
of  the  state  to  amend  or  repeal  does  not  necessarily  apply  to  subse- 
quent amendments  to  previously  existing  charters.  The  legislature 
may,  by  implication,  exclude  the  right  to  amend  from  a  charter  or  charter 
amendment.  So  held  in  a  tax  case.  New  Jersey  v.  Yard,  95  U.  S.,  104 
(1877).  A  change  in  the  method  of  serving  corporations  with  process 
is  constitutional.  Railroad  Co.  v.  Hecht,  65  U.  S.,  168  (1877).  Upon 
the  consolidation  of  two  corporations,  both  of  the  old  ones  are 
dissolved.  Hence  a  provision  of  the  new  charter  regulating  rates  is 
constitutional,  Shields  v.  Ohio,  95  U.  S.,  319  (1877).  A  shortening  of 
the  statute  of  limitations  relative  to  enforcing  the  statutory  liability 
of  stockholders  is  legal,  Terry  r.  Anderson,  95  U.  S.,  628  (1877).  An 
exemption  from  taxation  upon  payment  of  a  certain  tax  is  inviolable, 
Farrington  v,  Tennessee,  95  U.  S.,  679  (1877).  An  exemption  of  the 
capital  stock  from  taxation  does  not  exempt  the  tangible  property 
of  the  corporation,  Railroad  Co.  i*.  Gaines,  97  U.  S.,  697  (1878).  The 
business  transacted  under  a  corporate  charter  is  subject  to  the  police 


§  49 


FEDERAL    CONSTITUTION. 


132 


power  of  the  state.      Under  the  reserved  jwwer  the  legislature  may 
pass   any  law  affecting  the    pov/ers   of  a  corporation,    Beer  Co.   i>. 
Massachusetts,  97  U.  S.,  25    (1877).     The  agreement  of  the  state   to 
accept  the  notes  of  a  bank  in   payment  of  taxes  is  'rrepealabie,  Keith 
V.  Clark,  97  U.  S.,  454  (1878).     If  the  business  of  the  corporation  be- 
comes a  nuisance,  it  is  not  protected  by  its  charter,   Fertilizing  Co.  v. 
Hyde  Park,  97  U.  S.,  659  (1878).     The  consoi'dation  of  two  railroad 
corporations  dissolves  both   of   rhem   and  creates  a  new   one.        Ex- 
emptions of  the  old  corporation  irom  taxation  are  thereby  lost.  Railroad 
Co.  V.  Georgia,  98  U.  S.,  359  (1878).     An  exemption  from  ta.\ation  is 
inviolable,  University  v.  People,  99  U.  S.,  209  (1878).     Congress  can- 
not repudiate  its  contracts  any  more  than  a  state  can,  but  under  a  re- 
served right  it  may  amend  a  charter,  Sinking  Fund  Cases,  99  U.  S., 
700  (1878).     An  issue  of  bonds  by  a  municipality,  voted  before,  but 
issued    after  a  constitutional    amendment  prohibiting  such,   is   valid, 
Fairfield  r.  County  of  Gallatin,  100  U.  S.,  47  (1879).      Under  its  re- 
served power  to  amend  a  charter,  the  legislature   may  increase  the   li- 
cense fees  to  be  paid  by  a  street  car  company  to  the  city,  Railroad  Co  .v. 
Philadelphia,  loi    U.  S.,  528  (1879).       The  repeal  of  a  law  allowing 
suit  to  be  brought  against  a  state,  is  constitutional,  though  not  providing 
for  the  enforcement  of  the  judgment  and  though  the  debt  sued  on  was  in- 
curred before  the  repeal,  Railroad  Co.  ?;. Tennessee, loi  U.  S.,  337  (1879). 
An  exclusive  ferry  privilege  givenby  a  county  without  legislative  author- 
ity to  a  corporation  does  not  prevent  the  granting  of  ferry  privileges  by 
the  legislature,  Wright  v.  Nagle,  loi  U.  S.,  791  (1879).  A  lottery  license 
for  twenty-five  years  may  be  repealed  before  the  expiration  of  that  time. 
Charters  are  not  protected  by  the  above  constitutional  provision,  but  only 
the  contracts  of  charters.  Stone  v.  Mississippi,  loi  U.  S.,  814  (1879).     A 
statute  validating  irregularly  issued  municipal  bonds  is  legal,  Thompson 
V.  Perrine,  103  U.  S.,  8d6  (1880).     Statutory  authority  to  issue  bonds 
after  a  road  has  been  built  through  a  certain  town  is  repealed  by  a 
constitutional  prohibition  against  municipal  subscription  where  the  road 
was  not  built  before  the  constitutional  amendment,Railroad  Co.  v.  Fal- 
coner, 103  U.  S.,  821  (1880).    An  exemption  from  taxation  is  protected 
by  this  constitutional  provision.  Asylum  v.  New  Orleans,  105  U.  S ,  362 
(1881).     Under  a  reserved   right  to  repeal  a  charter,  the   legislature 
may  repeal  a  railroad   charter,  and   transfer  the   public  franchises  to 
another  corporation,  upon  due  compensation  being  paid  to  the  dissolved 
corporation,  Greenwood  v.  Freight  Co.,  105  U.    S.,  13  (1881).      Under 
the  reserved  power  any  amendment  may  be  made  that  does  not  defeat 
or  impair  the  object  of  the  charter.  Close  v.  Glenwood   Cemetery,  107 
U.    S.,  466  (1882).     An  exemption  from  taxation  cannot  be  given  when 


J. 


182 


133 


FEDERAL  CONSTITUTION. 


8   49 


iver  the  legislature  may 
rporatlon,  Beer  Co.  t>. 
cement  of  the  state  '  tc 
es  is  'rrepealable,  Keith 
s  of  the  corporation  be- 
rter,  Fertilizing  Co.  v. 
dation  of  two  railroad 
ites  a  new  one.  Ex- 
re  thereby  lost,  Railroad 
nption  from  taxation  is 
(1878).  Congress  can- 
ite  can,  but  under  a  re- 
Fund  Cases,  99  U.  S., 
jality,  voted  before,  but 
(hibiting  such,  is  valid, 
(1879).  Under  its  re- 
e  may  increase  the  li- 
the city.  Railroad  Co  .V. 
epeal  of  a  law  allowing 
nal,  though  not  providing 
1  the  debt  sued  on  was  in- 
5ee,ioi  U.S.,  337  (1879). 
irithout  legislative  author- 
:ing  of  ferry  privileges  by 
(1879).  A  lottery  license 
e  expiration  of  that  time, 
tional  provision,  but  only 
[oi  U.  S.,  814  (1879).  A 
onds  is  legal,  Thompson 
authority  to  issue  bonds 
n  town  is  repealed  by  a 
bscription  where  the  road 
ment,Railroad  Co.  v.  Fal- 
Tom  taxation  is  protected 
IT  Orleans,  105  U.  S  ,  362 
charter,  the  legislature 
the  public  franchises  to 
eing  paid  to  the  dissolved 
.  S.,  13  (1881).  Under 
lade  that  does  not  defeat 
Slenwood  Cemetery,  107 
ion  cannot  be  given  when 


the  state  constitution  forbids  it,  Louisville,  etc.,  R.  R.  Co.  j'.  Palmer,  109 
U.  S.,  244  (1883).      Where  a  corporation  is  bankrupt,    the   legislature 
may  authorize  a  vote  of  the  bondholders  on  the  question  of  recapitali. 
zation  and  reorganization  without  foreclosure,  and  may  provide  that  those 
not  voting   be    counted    as  voting  affirmatively.      A   bondholder  not 
voting  within   the   prescribed  time,  cannot  afterward  e<iforce  payment 
of  interest  on  his  original  bonds,  Gilfillan  v.  Union  Canal  Co.,  109  U.  S., 
401    (1883).     By  statute  in  Canada,  a  majority  of   railroad  bondholders 
may  bind  the  minority  to  a  plan  of  recapitalization  of  a  bankrupt  road. 
The  constitutional  provision  herein  does   not  apply,  Canada  Southern 
R.  R.  V.  Gebhard,  109  U.   S.,527  (1883).     Under  the  reserved   power 
of  amendment,  the  rates  charged  by  a  corporation  may  be  regulated, 
Spring,  etc..  Water-works  v.  Schdttler,  no  U.  S.,  347  (1884).      Where 
the  corporation  does  not  raise  the  constitutional   question   in  the   state 
court  from    which    the  appeal  is  taken,  the    supreme    court  of    the 
United  States   has  no  jurisdiction   herein,  Susquehanna,   etc.,  Co.   v. 
West.,  etc.,  Co.,    no    U.    S.,  57    (1884).     A  legislature  cannot  take 
away  a  municipality's   power  of  taxation  so  as  to  aiifect  the  payment  of 
a  judgment  against  the  municipality,  Nelson  v,  St.  Nelson's  Parish,  in 
U.  S.,  716  (1883).     Contracts  protected   herein  are  nevertheless  sub- 
ject to  the  police  power  of  the  state.     Statutes  protecting  the  public 
health  or  morals  may  vary  the  contract,   Butchers'  Union  Co.  v.  Cres- 
centCityCo.,  Ill  U.  S.,  746  (1883).     To  same  effect,  see  New  Orleans 
Gas  Co. «.  Louisiana  Light  Co.,  115  U.  S.,650  (1885),  holding  also  that 
the  constitutional  prohibition  applies  to  changes  by  state  constitutions  as 
well  as  by  statutes.  An  exclusive  gas  privilege  is  protected  even  against 
a  prior  general  statute   reserving  the   right  to   repeal  all  charters,  it 
appearing  that  the  particular  charter  contained  words  implying  such 
protection,  Louisville  Gas  Co.  v.  Citizens  Gas  Co.,  1 15  U.  S.,  683  (1885). 
An  exemption  of  the  corporation  fro9i  taxraioii,  may  be  so  worded  a  j 
to  exempt  also  the  shares  of  stock,  New  Or'.eans  v.  Houston,  119  U.  S., 
265  (1886).   An  exclusive  privilege  relative  to  water-works  is  protected, 
Tammany  Wa^er-works  v.  New  Orleans   Water-works,   120  U.  S.,  64 
(1886).     A  state  constitution  itself  is  not  a  contract  protected  against 
change.  Church  V.  Kelsey,  121  U.  S.,  2S2    (1886).      A  contract  is   not 
protected  herein  against  statutes  passed  previous  to   the  formation  of 
the  contract,  Lehigh   Water  Co.  v.   Easton,    121  U.   S.,  388   (1886). 
A  statute  which   repeals  a  judicial  remedy  for  enforcing  payment  of 
municipal  bonds  to  a  railroad,  the  remedy  being  in  existence  when  the 
bonds  were  issued,  is  void,    Seibert  v.   Lewis,  122  U.S.,  284(1886). 
Where  a  charter  granted  a  monopoly,  with  a  few,  exceptions,  and  a  city 
was  left  to  apply  the  exceptions,  a  decision  of  the  state  courts  that 


50 


FEDERAL  CONSTITUTION. 


134 


the  city  had  propt  riy  applied  the  exceptions  cannot  be  reviewed  by 
the  supreme  court  of  the  United  States,  New  Orleans,  etc.,  v.  Louis- 
iana, etc.,  Co.,  125  U.  S.,  18  (1888). 

§  50.  Congress  shall  hare  power  "to  reiirnUtfleommerce  With  foreign 
nations,  and  among  the  several  states,"  Art.  \.,  §  8. — A  bridge  across 
the  Ohio  river,  without  being  authorized  by  Congress,  although 
authorized  Sy  the  state  of  Virginia,  is,  if  it  actually  interferes  with 
navigation,  a  nuisance  and  may  be  abated.  State  of  Pennsylvania  t\ 
Wheeling,  etc..  Bridge  Co.,  13  How.,  518  (1851).  But  a  subsequent 
Act  of  Congress  legalizing  such  a  bridge  removes  all  objection  to 
it,  18  How.,  421  (1855).  The  court  will  not  necessarily  enjoin 
the  building  of  a  bridge  over  a  navigable  stream,  even  though  Con- 
gress has  not  authorized  it,  Oilman  r.  Philadelphia,  3  Wall.,  713 
(1865).  See,  however,  on  the  same  subject,  The  Passaic  Bridge,  3 
Wall.,  782.  A  *.ax  on  every  passenger  carried  out  of  the  state  is  held 
to  be  invalid  as  interfering  with  the  performance  of  the  functions  of 
the  federal  government,  Crandall  v.  State  of  Nevada,  6  Wall.,  35  (1867). 
The  regulation  by  the  state  of  foreign  insurance  corporations  is  not  a 
regulation  of  commerce,  Paul  t'.  Virginia,  8  Wall.,  168  (1868).  The 
taxation  by  the  state  of  a  corporation  incorporated  by  it,  and  also  incor- 
porated by  the  United  States  is  legal,  Thomson  v.  Pacific  Railroad  Co., 
9  Wall.,  579  (1869).  Insurance  business  by  foreign  companies  may  be 
regulated  by  a  state,  Liverpool  Ins.  Co.  v.  Massachusetts,  10  Wall.,  566 
(1870).  A  state  tax  of  railroad  corporations  levied  on  every  thousand 
pounds  of  freight  transported  is  unconstitutional,  as  regards  that  part 
of  the  freight  which  goes  out  of  the  state  or  is  brought  into  the  state, 
State  Freight  Tax  Case,  15  Wall.,  232  (1872).  But  the  state  may  tax 
the  gross  receipts  of  railroads,  even  though  such  receipts  are  partly  from 
inter-state  traffic.  State  Tax  on  Railway  Gross  Receipts,  15  Wall.,  284. 
(1872),  cp.  sub.  A  city  license  fee  exacted  from  corporations  transporting 
goods  beyond  the  state,  greater  than  the  city  license  fee  for  companies 
transix)rting  goods  within  the  slate  is  constitutional,  Osborne  v.  Mobile, 
16  Wall.,  479  (1872).  A  state  may  require  railroads  running  into  it  to 
annually  fix  and  post  its  rates.  Railroad  Co.  v.  Fuller,  17  Wall.,  560 
(1873).  A  state  tax  on  a  railroad  corporation  measured  by  the  actual 
value  of  such  proportion  of  its  shares  of  stock  as  the  length  of  the  road 
in  the  state  bears  to  the  whole  length  of  the  road,  is  constitutional,  Dela- 
ware Railroad  Tax,  18  Wall.,  206  (1873).  A  railroad  contract  with  the 
owner  of  an  elevator  to  give  the  latter  certain  business  is  not  abrogated 
by  reason  of  an  Act  of  Congress  which  enables  the  former  to  dispense 
with  thee!evato»,  Railroad  Co.  v.  Richmond,  19  Wall.,  584  (1873).     A 


!f. 


184 


186 


FEDERAL  CONSTITUTION. 


50 


cannot  be  reviewed    by 
Orleans,  etc.,  v.  Louis- 


te  comnierce  with  foreign 

§  8. — A  bridge  across 
l)y    Congress,    although 

actually  interferes  with 
state  of  Pennsylvania  v. 
J51).  But  a  subsequent 
emoves  all  objection  to 
I  not  necessarily  enjoin 
tream,  even  though  Con- 
iladelphia,  3    Wall.,   713 

The  Passaic  Bridge,  3 
out  of  the  state  is  held 
lance  of  the  functions  of 
evada,6  Wall.,  35  (1867). 
ce  corporations  is  not  a 
Wall.,  168  (1868).  The 
ited  by  it,  and  also  incor- 
1  V.  Pacific  Railroad  Co., 
•reign  companies  may  be 
ssachusetts,  10  Wall.,  566 
evied  on  every  thousand 
nal,  as  regards  that  part 
is  brought  into  the  state, 
But  the  state  may  tax 
h  receipts  are  partly  from 

Receipts,  15  Wall.,  284. 
corporations  transporting 
icense  fee  for  companies 
lonal,  Osborne  v.  Mobile, 
lilroads  running  into  it  to 
.  V.  Fuller,  17   Wall.,  560 

measured  by  ihe  actual 
as  the  length  of  the  road 
id,  is  constitutional,  Dela- 
railroad  contract  with  the 
business  is  not  abrogated 
IS  the  former  to  dispense 
19  Wall.,  584  (1873).     A 


charter  provision  that  the  railroad  should  pay  to  the  state  one-fifth  of  its 
receipts   from   passenger  traffic  is  constitutional  even  though  the  road 
runs  into  another  state  and   obtains  part  of  said   proceeds  therefrom. 
Railroad  Co.  v.  Maryland,  21  Wall.,  456  (1874).     The  Act  of  Congress 
r-ilative  to  telegraph  companies  prevents  a  state  from  giving  a  monopoly 
of  telegraph  business  in  the  state  to  one  company,  Pensacola  Tel.  Co.  v. 
"West.,  etc.,  Tel.  Co.,  96  U.  S.,  i  (1877).   Vessels  plying  between  states 
may  be  taxed  in  the  state  of  the  corporation  owning  them.  Transportation 
Co.  V.  Wheeling,  99  U.  S.,  273  (1878).     A  municipal  corporation  owning 
wharves  may  charge  wharfage  therefor,  though  the  wharves  accommodate 
inter-state  commerce,  Packet  Co.   /•.  St.  ].ouis,  100  U.  S.,  423  (1879), 
Vicksburg  v.  Tobin,  Id.  430.      But  there  must  be  no  discrimination 
against  the  com.tierce  from  other  states,  Guy  v.  Baltimore,  Id.  434.     A 
state  tax  on  each  message  received  or  sent  out  by  a  telegraph  company  is 
unconstitutional.  Telegraph  Co.  r.  Texas,  105  U.  S.,  460   (1881).     A 
municipality  may  forbid  vessels  landing  at  any  except  municipal  wharves. 
Packet  Co.  v.  Catlettsburg,  105  U.  S.,  559  (1881).     Reasonable  wharf- 
age may  be  demanded  by  a  city  for  the  use  of  its  wharves,  Transporta- 
tion Co.  V.  Parkersburg,  107  U.  S.,  691  (1882).     A   state   statute  pro- 
hibiting foreign  corporations  from  doing  business  in  the  state  unless  a 
certificate  is  filed,  etc.,  does  not  prevent  the  collection  of  a  debt  for 
.nachinery  delivered  by  the  foreign  corporation  to  parties  in  the  state. 
Cooper  Manufacturing  Co.  v.  Ferguson,  113  U.  S.,  727  (1884). 

Inter-«tate  commerce  is  exclusively  within  the  control  of  Congress. 
A  state  tax  on  a  ferry  corporation,  the  ferry  being  inter-state,  is  unconsti- 
tutional, if  it  amounts  to  a  tax  on  the  receiving  and  landing.  The  state 
may  collect  moneys  only  as  compensation  for  property  employed,  or 
facilities  for  using  it,  or  by  an  ordinary  tax  on  property,  Gloucester 
Ferry  Co.  v.  Pennsylvania,  114  U.  S.,  196  (1884).  A  state  tax 
of  ^50  per  car  per  annum  on  passenger  coaches,  run  over  rail- 
roads in  the  state,  is  unconstitutional  so  far  as  il  applies  to  coaches 
run  from  or  into  other  states,  or  across  the  state,  and  owned  by  a 
foreign  corporation,  though  leased  to  the  railroads,  Pickard  v.  Pullman 
Southern  Car  Co.,  117  U.  S.,  34  (1885);  Tennessee  v.  Pullman 
Southern  Car  Co.,  Id.  51.  A  state  statute  forbidding  rai'.roads  to 
■charge  more  for  a  short  haul  than  for  a  long  haul  is  unconstitutional,  so 
far  as  it  applies  to  hauls  beyond  the  state,  Wabash,  etc..  Railway  Co. 
V.  Illinois,  118  U.  S..  557  (1886).  A  state  tax  upon  the  gross 
receipts  of  a  foreign  transportation  company  is  void,  as  interfering  with 
inter-state  commerce,  where  the  gross  receipts  included  receipts  for 
carrying  freight,  into,  out  of,  and  across  the  state,  Fargo  v.  Michigan, 
121  U.  S ,  230  (1887).     So  also  of  a  tax  on   a  steamship  company's 


FEDERAL  CONSTITUTION. 


180 


'>? 


gross  receipts,  where  the  traffic  was  inter-state  and  with  foreign  coimtries, 
Philadelphia  Steamship  Co.  v.  Pennsylvania,  122  U.  S.,  326  (1887); 
questioning  State  Tax,  etc.,  15  W.'ill.,  284  su/>ra.  A  state  regulation  of 
inter-state  telegraphic  communication  is  unconstitutional.  Western 
U.  Tel.  Co.  r.  Pendleton,  122  U,  S..  347  (1887). 

A  statute  requiring  railroad  engineers  to  be  examined  for  color 
blindness  is  constitutional,  Smith  f.  Alabama,  124  U.  S.,  465  (1887); 
Nashville,  etc.,  Railway  v.  Alabama,  128  U.  S.,  96  (1888).  A  bridge 
across  a  navigable  river  is  legal  when  authorized  l)y  a  state,  although 
Congress  has  not  authorized  it,  there  being  no  Act  of  Congress  pro- 
hibiting it,  Willamette,  etc.,  Co.  r.  Hatch,  125  U.  S.,  i  (1888).  A 
statute  which  prohibits  the  bringing  of  liquor  into  a  state,  with  certain 
exceptions,  is  void,  Bowman  v.  Chicago,  etc.,  RailwaV)  125  U.  S.,  465 
(1888).  A  statute  authorizing  an  injunction  against  a  telegraph  company 
from  operating  its  wires  until  a  tax  is  paid  is  void  if  the  wires  are  used  on 
post  roads,  Western,  etc.,  Co.  v.  Massachusetts,  125  U.  S.,  530 
(1888).  A  telegraph  company  doing  an  inter-state  business  cannot  be 
compelled  to  pay  a  license  fee  in  order  to  do  business  within  a  state, 
Leloup  V.  Mobile,  127  U.  S.,  640  (1888).  A  state  may  tax  a  telegraph 
company  on  its  receipts  from  telegrams  given  and  delivered  within  the 
state,  but  not  on  inter-state  telegrams,  Ratterman  v.  Western  U. 
Tel.  Co,  127  U.  S.,  411  (1888).  A  state  tax  levied  upon  the 
franchise  of  a  railroad  corporation  which  is  chartfered  by  the  federal 
government,  and  which  runs  through  several  states,  is  unconstitutional^ 
California  V.  Central  Pac.  Railroad  Co.,  127  U.  S.,  i  (i888). 

g  51,  "  The  citizens  of  each  state  shall  be  entitled  to  all  prlTileges  and 
immnnitiesof  citizens  in  the  several  states,"  Art.  IV.,  §  2. — A  corpora- 
tion is  not  a  ♦'citizen"  in  the  sense  here  used,  and  this  provision  con- 
fers no  rights  upon  a  corporation,  Pembina  Mining  Co.  i\  Pennsyl- 
vania, 125  U.  S.,  181  (1888).  So  held  where  a  state  prohibited 
foreign  insurance  companies  from  doing  business  unless  licensed  by  the 
state,  Paul  v.  Virginia,  8  Wall.,  168  (1868).  Also  where  a  license  fee 
and  payment  to  cities  of  a  percentage  of  premiums  received  were  re- 
quired. Ducat  V.  Chicago,  ip  Wall.,  410  (1870).  See  also.  Liverpool 
Ins.  Co.  V.  Massachusetts,  10  Wall.,  566  (1870);  Philadelphia  Fire 
Association  v.  New  York,  119  U.  S.  no  ;  Doyle  v.  Continental  \Ins, 
Co.,  94  U.  S.,  535,  (1876)  ;  Cooper  Manufacturing  Co.  v.  Ferguson, 
113  U.S.,  727  (1875). 

g  52.  The  United  States  coarts  have  Jurisdiction  of  cases  arising  be- 
tween citizens  of  different  states,  and  between  citizens  and  foreign  states* 
and  between  citizens  and  citizens  or  subjects  of  foreign  states,  Art.  III.,  §  2. 


'W. 


130 


mtl  with  foreign  countries, 
laa  U.  S.,  326  (1887); 
a.  A  state  regulation  of 
iconstitution.il,     Western 

I  be  examined  for  color 
124  U.  S.,  465  (1887); 
,  96  (1888).  A  bridge 
ed  by  a  state,  although 
10  Act  of  Congress  pro- 
5    U.   S.,   I    (1888).     A 

into  a  state,  with  certain 
Railway,  125  U.  S.,  465 
inst  a  telegraph  company 
d  if  the  wires  are  used  on 
usetts,  125  U.  S.,  530 
-state  business  cannot  be 
business  within  a  state,, 
itate  may  tax  a  telegraph 

and  delivered  within  the 
tterman  v.  Western  U. 
;e  tax  levied  upon  the 
chartfered  by  the  federal 
ates,  is  unconstitutional^ 

S.,  I  (i888), 

Itled  to  all  prlTilegeHand 

:t.  IV.,  §  2. — A  corpora- 
,  and  this  provision  con- 
Mining  Co.  V.  Pennsyl- 
here  a  state  prohibited 
;ss  unless  licensed  by  the 
llso  where  a  license  fee 
niums  received  were  re- 
0).  See  also.  Liverpool 
870);  rhiladelphia  Fire 
oyle  V.  Continental  xins, 
:uring  Co.  v.   Ferguson, 

stion  of  cases  arising  be> 
Itizens  and  foreign  states* 
■elgn states,  Art.  III.,  §  2. 


187 


FEDERAL  CONSTITUTION, 


»  fiJi 


See  also  Amendments,  Art.  XI.— In  the  early  case,  Bank  of  United 
States  r.  Deveraiix,  5  c:ranch.,6i  (1809)  the  snpriMnc  court  of  the  United 
States  held,  per  Marshall,  C.  J.,  that  the  citizenship  of  a  corporation de- 
jiended  not  on  the  place  where  it  was  incorporated,  biit  on  the  citizenship 
of  its  various  stockholders.  Hut  this  decision  was  suhseciiiently 
overruled  and  is  no  longer  the  law.  As  regards  the  right  of  a  corpora- 
tion to  sue  or  be  sued  in  the  federal  courts,  a  corporation  is  now  held 
to  be  a  citizen  of  the  state  which  incorporated  it.  Railway  Co.  r.  Whit- 
ton's  Admin.,  13  Wall.,  270  (1871);  Louisville,  etc..  Railroad  r.  Letson, 
2  How.,  497  (1844);  Marshall  *•.  B.  iV  O.  Railroad,  16  Id.,  314  (1853); 
Covington,  etc.,  Co.  c.  Shepherd,  20  Id..  227  (1857);  Cowles  v.  Mercer 
County,  7  Wall.,  n8  (1868);  Express  Co.  /-.  Kountze  Bros.,  8  Id.,  342 
(1869);  Insurance  Co.  v.  Morse.  20  Id.,  445  (1874).  If  a  corporation 
is  incorporated  in  two  states  it  consists  of  two  corporations,  one  in  each 
state,  Ohio,  etc.,  Missouri  Railroad  t-.  Wheeler,  1  Black.,  286  (1861).  See 
Cook  on  Stock  and  Stockholders  and  General  Corporation  Law,  §  697. 

An  agreement  of  a  foreign  corporation,  as  a  condition  of  its  being  al- 
lowed to  do  business  in  the  state,  that  it  will  not  remove  cases  from  the 
state  to  the  United  States  courts  is  not  binding,  Insurance  Co.  v.  Morse, 
20  Wall.,  445  (1874).  But  in  case  the  corporation  violates  such  agree- 
ment, the  state  may  then  forbid  its  doing  any  further  business,  Doyle  r. 
Contmental  Ins.  Co.,  94  U.  S.,  535  (1876).  See  also  Barron  v.  Burnside, 
122  U.  S.,  186  (1886),  to  the  effect  that  the  agreement  not  to  remove  is 
void. 

Congress  has  enacted  various  statutes  defining  the  cases  in  which 
suits  may  be  instituted  in  or  removed  to  the  federal  courts,  see  Cook  on 
Stock  and  Stockholders  and  General  Corporation  Law,  §§  757-758. 

When  a  corporation  is  created  by  Congress  itself.  Congress  may 
give  or  take  away  from  the  federal  courts  jurisdiction  of  the  suits  in 
which  that  corporation  may  be  a  party.  This  is  constitutional,  since  the 
case  arises  under  the  law  of  the  United  States  which  grants  the  charter, 
Osborne  v.  United  States  Bank,  9  Wheat.,  738  (1824),  where  jurisdiction 
was  given  to  the  federal  courts,  see  also  Kennedy  v.  Gibson,  8  Wall.,  498 
(1869),  relative  to  national  banks.  By  amendment  of  the  national  bank- 
ing act  in  1882  and  1888,  snch  banks  dre,  for  purposes  of  litigation,  now 
considered  citizens  of  the  state  wherein  th'.y  are  located,  National  Park 
Bank  v.  Nichols,  4  Bin.,  315  (1869);  Manufacturers' National  Bank  v. 
Baack,  Blatch.,  137  (1871*);  St.  Louis,  etc..  Bank  v.  Allen,  5  Fed.  Rep., 
551  (1881).  The  various  Pacific  railroads  incorporated  by  the  United 
States  may  bring  suit  in  or  remove  them  to  the  federal  courts,  Pacific 
Railroad  Removal  Cases,  115  U.  S.,  i  (1884);  United  States  r.  Union  Pa- 
cific Railroad  Co.,  98  U.  S.,  569  (1878);  U.  S.  Rev.  Stat.,  §  640;  Kain  v. 


Rd 


FKDRKAL  CONSTITUTION. 


138 


V,  Texas  Pacific  Railroad  Co.,  3  Cent.  I..  J.,  u  (1875);  Yard  r.  Diirant, 
4  Cliff.,  113  (1869);  Fisk  r.  U.  P.  Railroad  Co.,  6  HIatch.,  36a  (1869); 
Ames  J'.  Kansas,  in  U.  S.,  449  (1883);  Hughes  v.  Northern  Pacific 
Railroad  Co.,  18  Fed.  Rep.,  106  (1883);  Southern  Pacific  Railroad  Co. 
V,  California,  118  U.  S.,  109  (1886). 


^  :>:).  N«  Htatf)  Bhall  "deprive  anji  penton  of  life,  liberty,  or  property, 
without  due  proceM  of  law :  nor  deny  to  any  penton  witliln  Um  JurlBdietion 
the  eqnal  protection  of  the  laws."  Amendments  Art.  XIV.,  also  .Art.  V.— 
This  provision  is  often  invoked  l)v  corporations,  in  connection  with  the 
provision  atjainst  impairing  the  obligation  of  contracts.  The  following 
decisions  have  been  made: 

Statutes  reducing  railroad  rates  are  constitutional,  Munn  r.  Illinois, 
etc.,  Railroad,  94  U.  S.,  113  (1876);  see  also  the  remaining  cases  in  that 
volume,  which  together  are  called  "  The  Granger  Cases."  The  taxation 
of  railroads  by  apportionment  among  the  municipalities  through  which 
they  run  is  not  |)rohihited  by  the  above  amendment,  State  Railro&d 
Tax  Cases,  92  U.  S.,  575  (1875).  It  is  constitutional  for  a  municipal 
corporation  to  levy  taxes  for  the  draining  of  swamps,  Davidson  v.  New 
Orleans,  96  U.  S.,  97  (1877),  a  case  which  fully  discusses  the  meaning 
of "  due  process  of  law."  Validating  investments  by  foreign  corporations 
does  not  deprive  the  borrower  of  property  "  without  due  process  of  law," 
dross  r.  U.  S.  Mortgage  Co.,  to8  U.  S.,  477  (1883).  As  further  illustra- 
tive of  the  exercise  of  the  police  power  of  the  state,  in  reference  to  corpor- 
ations, see  Slaughter  House  Cases,  16  Wall.,  36  (1872),  upholding  a  mo- 
nopoly given  to  a  corporation,  and  also  passing  upon  the  application  of  the 
amendments  to  the  United  States  Constitution;  Bartemeyer  v.  Iowa,  18 
Wall.,  129  (1873),  holding  that  a  state  may  prohibit  the  sale  of  liquors, 
but  quaere  as  to  the  effect  of  the  constitutional  amendment,  in  the  case 
of  liquors  on  hand  at  the  time  of  the  state  prohibitory  act;  to  same  effect, 
Beer  Co.  v.  Massachusetts,  97  U.  S.,  25  (1877).  The  legislature,  undef 
its  police  power,  may  regulate  slaughtering,  even  though  it  has  con- 
tracted not  to  do  so.  Butchers'  Union  Co.  v.  Crescent  City  Co.  ,111  U. 
S.,  746  (1883).  The  legislature  may  compel  railroads  to  build  fences 
and  may  prescribe  double  penalties  for  omission,  Missouri  Pacific  Rail- 
way Co.  V.  Hanes,  115  U.  S.,  512  (1885).  See  also  Cook  on  Stock  and 
Stockholders  and  General  Corporation  Law,  §  675.  Under  its  general 
legislative  powers  the  legislature  may  regulate  ^ater  rates,  Spring  Valley, 
etc.,  Works  v.  Schottler,  no  U.  S.,  347.  Prohibitory  laws  are  constitu- 
tional, Fosters.  Kansas,  112  U.  S.,  201  (1884)  ;  Mugler  v.  Kansas, 
123  U.  S.,  623  (1887).  Allowing  property  to  be  taken  on  condemnation 
for  mill  race  overflow  purposes  is  constitutional.  Head  r.  Amoskeag 


N. 


IN 


I  (1875);  Yard  »•.  Durant, 
.,  6  HIatch.,  363  (1869); 
{lies  I'.  Morthern  Pacific 
lern  Pacific  Railroad  Co. 


r  llfp,  lihprty,  or  property, 
Hon  nithinltMjnrladletloa 

Art.  XIV.,  also  Art.  v.— 
IS,  in  connection  with  the 
;ontracts.     The  following 

utional,  Mtinn  v.  Illinois, 
ie  remaining  cases  in  that 
;er Cases."  The  taxation 
nicipalities  through  which 
lendment.  State  Railroad 
titutional  for  a  municipal 
iwanips,  Davidson  r.  New 
lly  discusses  the  meaning 
ts  by  foreign  corporations 
houtdue  process  of  law," 
883).  As  further  illustra- 
ite,  in  reference  to  corpor- 
5  (1872),  upholding  a  mo- 
upon  the  application  of  the 
1;  Bartemeyer  V.  Iowa,  18 
rohibit  the  sale  of  liquors, 
al  amendment,  in  the  case 
ibitory  act;  to  same  effect, 
7).  The  legislature,  undef 
even  though  it  has  con- 
Crescent  City  Co.  ,111  U. 
railroads  to  build  fences 
on,  Missouri  Pacific  Rail- 
e  also  Cook  on  Stock  and 
i  675.  Under  its  general 
i^ater  rates.  Spring  Valley, 
ihibitory  laws  are  constitu- 
$84)  ;  Mugler  r.  Kansas, 
be  taken  on  condemnation 
ional.  Head  r.  Amoskeag 


180 


FRDKRAL  CONHTITUTION. 


8  54 


Manufacturing  Co.,  113  U.  S., 9  (1884).  It  is  constitutional  K.taxraiU 
road  pro|>erty  differently  from  other  classes  of  property,  Kentucky 
Railroad  Tax  Cases,  1 15  U.  S.,  321  (1885).  The  legislature  may  regu- 
late railroad  rates,  unless  the  right  has  been  clearly  granted  away;  may 
authorize  commissioners  to  regulate  rates,  and  may  rf«|uire  fences  to  be 
built,  Railroad  Commission  Cases,  ii6  U.  S.,  307,  347.  35^  (1886), 
A  state  tax  levied  on  railroad  property  not  specified  in  the  taxation 
statute  is  void  under  this  provision  of  the  United  States  constitution, 
Santa  Clara  County  v.  Southern  Pacific  Railroad  Co.,  118  U.  S.,  394 
(1885).  This  constitutional  provision  does  not  prevent  a  state  from 
imposing  a  tax  on  a  foreign  insurance  company  for  doing  business  in 
the  state,  inasmuch  as  the  corporation  is  not  admitted  into  the  state  until 
it  pays  the  tax,  Philadelphia  Fire  Association  v.  New  York,  119  U.  S., 
no  (1886).  But  a  corporation  is  a  "  person"  in  the  meaning  of  this 
provision,  Pembina  Mining  Co.  v.  Pennsylvania,  125  U.  S.,  181  (1888), 
holding,  however,  that  a  state  may  regulate  the  right  of  forei'jn  corpora- 
tions to  do  business  in  the  state.  A  reduction  of  railroad  rates  is  consti- 
tutional although  the  rate  is  to  vary  according  to  the  length  of  the  road 
and  results  in  disastrous  loss  to  the  railroads,  Dow  v.  Betdelman,  123  U. 
S.,  680  (1888). 

A  statute  rendering  railroads  liable  to  their  employes  for  injuries 
caused  by  the  negligence  of  their  fellow  servants  is  constitutional, 
Missouri  Pacific  Railway  Co.  v.  Mackey,  127  U.  S.,  205  (1888).  So  also 
is  a  statute  rendering  a  railroad  liable/or  double  the  value  of  stock  killed 
by  it,  Minneapolis,  etc..  Railway  Co.  v.  Beckwith,  129  U.  S.,  26  (1889), 
holding  also  that  corporations  are  "  persons"  within  the  meaning  of 
the  above  constitutional  provisions. 

§  54.  Corporations  created  by  the  United  States — The  constitutional 
power  of  the  federal  government  to  create  a  corporation  has  been  a 
political  as  well  as  a  judicial  question.  The  United  States  Bank,  through 
the  influence  of  Alexander  Hamilton,  was  chartered  by  the  federal 
government  in  179 1,  and  was  re-chartered  in  1 816.  The  constitutionality 
of  these  charters  was  vigorously  attacked  by  the  Democratic  party, 
and  in  1833  President  Jackson  vetoed  and  defeated  a  third  charter 
to  such  an  institution.  A  similar  charter  was  vetoed  by  President  Tyler 
in  1841.  The  advent  of  the  Republican  party  to  power,  and  the  outbreak 
of  the  civil  war,  brought  new  political  ideas  into  force.  The  result  has 
been  that  the  federal  government  has  granted  many  charters  to  two  classes 
of  enterprises— national  banks  and  railroads  running  into  two  or  more 
states.  In  1862  Congress  chartered  the  Union  Pacific  Railroad  Co. 
(12  Stat,  at  Large,  489).     In  1864  Congress  chartered  the  Northern  Pa- 


•AW- 


■iiMii 


55 


NATIONAL  BANKS. 


140 


cific  Railroad  Co.;  in  1866  the  Atlantic  &  Pacific  Railroad  Co.;  in  1871 
the  Texas  Pacific  Railway  Co.;  and  other  charters  have  been  granted. 
The  incorporation  of  national  banks  was  authorized  by  a  general  stat- 
ute passed  in  1863. 

In  an  early  decision  by  Chief  Justice  Marshall,  the  legality  of  the 
charter  of  the  United  States  Bank  was  upheld,  McCulloch  v.  State  of 
Maryland,  4  Wheat.,  31C  (1819);  see  to  same  effect,  Osborn  r.  U.  S. 
Bank,  9  Wheat.,  738  (1824).  The  constitutionality  of  the  present 
national  bank  charters  has  also  been  upheld,  Farmers',  etc.,  National 
Bank  v.  Deanng,  91  U.  S.,  29  (1875);  Legal  Tender  Case,  110  U.  S., 
421,445  (1883). 

Congress  has  power  to  create  corporations  in  the  District  of  Colum- 
bia, Hadley  v.  Freedman's  Savings,  etc.,  Co.,  2  Tenn.,  ch.  122  (1874); 
Williams  v.  Creswell,  51  Miss.,  817  (1876);  Daly  v.  National  Life 
Ins.  Co.,  64  Ind.,  i  (187S). 

A  railroad  incorporated  by  the  United  States  may  be  com- 
pelled by  mandamus  to  perform  its  duties.  Union  Pacific  Railroad  Co. 
V.  Hall,  91  U.  S.,  343  (1875),  supreme  court  below,  3  Dill.,  515.  It 
is  well  settled  that  a  corporation  ikicorporated  by  the  United  States  is  ex- 
empt from  the  operation  of  state  laws,  so  far  as  those  laws  affect  the 
corporation  in  its  use  as  a.i  instrument  of  government  by  the  United 
States,  Farmers',  etc.,  National  Bank  v.  Dearing,  91  U.  S.,  29  (1875). 
S''ch  also  is  the  rule  in  regard  to  state  usury  laws,  and  state  taxation  of 
such  corporations,  see  Railroad  Co.  r.  Peniston,  18  Wall.,  5  (1873); 
National  Bank  v.  Commonwealth,  9  Wall.,  353  (1869);  Thomson  t-. 
Pacific  Railroad,  9  Wall.,  579  (1869);  and  Cook  on  Stock  and  Stock- 
holders and  General   Corporation  Law,  §  569. 

§  55.  National  Banks. — By  the  National  banking  Act,  the  articles 
of  association  may  contain  any  "  provisions,  not  inconsistent  with  law, 
which  the  association  may  see  fit  to  adopt  for  the  regulation  of  its  busi- 
ness and  the  conduct  of  its  ai'fairs,"  §  5133,  Rev.  Stat,  of  'U.  S.  Incor- 
poration is  by  filing  a  certificate,  under  the  general  incorporatingr  act, 
§5135.  The  corporation  shall  exist  for  twenty  years,  unless  the  arti- 
cles of  association  or  two-thirds  in  interest  of  the  stockholders  pre- 
scribe otherwise.  The  corporation  may  at  any  time  change  it.s 
officers.  It  shall  not  commence  business  until  authorized  to  do  so 
by  the  comptroller  of  the  currency,  §  5136.  It  shall  not  take  a 
mortgage  on  real  estate.  It  shall  not  hold  real  estate  taken  on 
a  debt,  for  over  five  years,  §  5137.  The  capital  is  to  be  1150,000 
or  over  if  in  a  city  of  less  than  6,000  population;  $ioc,oooorover  if  less 
than  50,000;  $200, coo  or  over  if  over  50,000  people,  §  51^8.  Fifty  per 
cent  of  the  capital  stock  is  to  be  paid  in  upon  organization,  and  ten  per 


f 


140 


141 


THE  INTER-STATE  RAILWAY  ACT. 


56 


acific  Railroad  Co.;  in  1871 
;harters  have  been  granted, 
uthorized  by  a  general  stat- 

Marshall,  the  legality  of  the 
eld,  McCulloch  v.  State  of 
ime  effect,  Osbom  v.  U.  S. 
itutionality  of  the  present 
sld,  Farmers',  etc..  National 
il  Tender  Case,  110  U.    S., 

•ns  in  the  District  of  Colum- 
o.,  2  Tenn.,  ch.  122  (1874); 
5);    Daly  v.    National   Life 

lited  States  may  be  corn- 
Union  Pacific  Railroad  Co. 
ourt  below,  3  Dill.,  515.  It 
d  by  the  United  States  is  ex- 
far  as  those  laws  affect  tho 

government  by  the  United 
earing,  91  U.  S.,  29  (1875). 
y  laws,  and  state  taxation  of 
liston,  18  Wall.,  5  (1873); 
.,  353    (1869);  Thomson  f. 

Cook  on  Stock  and  Stock- 

59- 

lal  tanking  Act,  the  articles 
,  not  inconsistent  with  law, 
or  the  regulation  of  its  busi- 

Rev.  Stat,  of  U.  S.  Incor- 
:  general  incorporating  act, 
!nty  years,  unless  the  arti- 
;st  of  the  stockholders  pre- 
•  at  any  time  change  its 
5  until  authorized  to  do  so 
[36.      It   shall    not    take  a 

hold  real  estate  taken  on 
le  capital  is  to  be  $50,000 
:ion;  $toc,oooorover  if  less 
5  people,  §  5138.  Fifty  per 
pou  organization,  and  ten  per 


cent    on  or  before  each  succeeding  five  months,  §5140-     It  may   re- 
duce the  capital  stock  on  a  two-thirds  vote  of  all  the  stock,  §  5143. 
No    stockholder   who  has  failed  to  pay  calls  on  his  stock  shall  vote 
at  elections,  §5144,  see  36  Fed.    Kep.,   246.     There  must  be  five  or 
more  directors.     They  hold  office    for  one   year,  §   5145.     Directors 
must  be  citizens  of  the  United  States;  three-fourths  must  have  been  resi- 
dents ol  the  state  for  a  year;  and  each  must  own  ten  or  more  shares  of 
stock,  §   5146.     The    directors    must  take  an  oath,    §  5147.     Stock- 
holders are  liable  for  corporate  deb.s  to  an  amount  equal  to  and  in 
addition    to    the    subscriptions    for   their    stock,   §  5 151.     Executors, 
administrators,    guardians     and     trustees    are     not     liable    on  stock, 
but    the    trust     fund    is    liable,    §    5152.       The    deposit   of    United 
States  bonds    owned    by   the    national    bank,  with   the  United  Stttes 
treasurer,  as    security  that   the    bank   will    redeem   the   paper  money 
that   the    national    banking    act    authorizes     it    to    issue,    is   a    sub- 
ject of  minute  regulation,    see  §§    5157,    etc.      For    usury  the   bank 
forfeits  the  interest,  and  if  the  interest  is  already  paid,  twice  its  amount 
may  be  recovered  back,  §  5198.     Before  a  dividend  is  declared,  one- 
tenth   of  the   profits  are  to   be  added  to  the  surplus  fund,  until  the 
latter   h  twenty  per  cent  of   the    capital,    §    5199.     The   bank    shall 
not  puichase  or  loan  on  tho  security  of  its  own  stock,  §  5201.  In  case 
of  impairment  of  capital  stock,  the  stockholders  must  be  assessed  to  re- 
place   it,  §   5205.     Five  reports  are    to  be  made  during  each   year, 
§  521 1.     Shares  of  stock  in  national  banks  may  be  taxed  by  the  states, 
§  5219.     The  comptroller  may  appoint  a  receiver  of  a  bank,  whenever 
he  is  satisfied  that   it  is  insolvent,  Act  of  June  30,  1876,  §  i.     National 
banks  are  citizens  of  the   state  where  they  are  located,   so   far  as 
litig.;tion  is  concerned,  ch.  373,  Acts  of  1887.     They  may  increase 
their  ca^llal   stock  upon  a  two-thirds  vote   in   interest  of  the  stock, 
ch.  73,  Acts  of  1886.     Upon   the  expiration  of  the  bank  charter,   the 
charter  may  be  renewed  by  two-thirds  in  interest  of  the  stock,  but  dis- 
senting stockholders   must  be  bought  out  at  an  appraised  valuation  of 
their  stock,  ch.  290,  Act  of  1882.   For  purposes  of  suit,  a  national  bank 
is  a  citizen  of  the  state  in  which  it  is  located,  ch.  866,  §  4,  L.  1888. 

g  56.  The  Inter-Stotc  Railway  Act^By  Act  of  Congress  February 
4,  1887,  commonly  cal'ed  "The  Inter-State  Act,"  all  railroads  running 
from  one  state  into  another,  were  rendered  subject  to  the  following 
provisions  :  Railroad  charges  are  to  be  reasonable.  Discriminations 
between  persons  are  prohibited.  So,  also,  are  discriminations  betweten 
localities  or  kinds  of  traffic.  Railroads  must  give  equal  facilities 
to  all  connecting  lines.      Greater  charges,  under  substantially  similar 


THE  INTER-STATE  RAILWAY  ACT. 


circumstances  and  conditions  for  a  shorter  than  for  a  longer  dis- 
tance over  the  same  line,  in  the  same  direction,  the  shorter  being 
included  within  the  longer  distance,  are  prohibited.  Pools  between 
competing  roads  are  prohibited.  Ten  days'  r.otice  must  be  given 
of  advances  in  rates.  Free  passes  are  prohibited.  Five  commis- 
sioners are  appointed  by  the  President  of  the  United  States,  with  the 
concurrence  of  the  Senate,  to  apply  the  law.  The  powers,  duties  and 
functions  of  this  commission,  however,  are  somewhat  limited,  see  37 
Fed.  Rep.,  567.  By  the  act  of  March  3,  1889,  amendments  were  made 
requiring  three  days'  notice  of  reductions  in  rates;  railroad  officials  are 
nade  subject  to  imprisonment  as  well  as  fines  for  violation  of  the  act» 
and  shippers  are  made  liable  also  for  inducing  a  violation. 


^^ 


AY  ACT. 


1.1 


ir  than  for  a  longer  dis- 
rection,  the  shorter  being 
rohibited.  Pools  between 
ys'  r.otice  must  be  given 
rohibited.  Five  commis- 
e  United  States,  with  the 
The  powers,  duties  and 
somewhat  limited,  see  37 
9,  amendments  were  made 
rates;  railroad  officials  are 
s  for  violation  of  the  act» 
g  a  violation. 


CHAPTER  IV. 

STATUTORY    PROVISIONS   IN   ENGLAND,   CANADA,    FRANCE    AND     GERMANY, 
IN   REGARD   TO   CORPORATIONS. 


57.  England. 

58.  Canada. 

59.  Quebec. 

60.  Nova  Scotia. 

61.  New  Brunswick. 


§  62.  Ontario. 

63.  British  Columbia. 

64.  France. 

65.  Germany. 


§  57.  ENGLAND.  Constitntional  Provisions. — It  is,  i)erhaps,  un- 
necessary to  state  that  England  has  no  written  constitution  similar  to 
that  of  the  United  States  and  the  various  States  of  the  Union.  Certain 
gran  s  of  the  Crown  such  as  Magna  Charter,  the  Petition  of  Rights,  the 
Bill  of  Rights,  ard  certain  Parliamentary  Acts,  such  as  the  Habeas 
Corpus  Act,  may  be  said  to  constitute  the  written  constitution  of  Eng- 
land. But  there  are  no  constitutional  provisions  specially  affecting  cor- 
porations. 

Miscellaneons  Corporations. — A  thorough  study  of  the  English  acts 
authorizing  the  incorporation  of  companies  gives  valuable  information 
and  suggestions  concerning  corporations.  These  statutes  were  carefully 
framed.  They  grew  gradually  out  of  the  necessities  of  business.  They 
form  a  corporation  code  m  themselves,  and  they  regulate  corporations 
in  many  particulars,  where  the  American  statutes  are  silent  and  leave 
♦.he  subject  to  the  common  law  and  the  decisions  of  the  courts.  The 
most  important  of  the  provisions  are  here  referred  to. 

The  general  incorporating  act  is  called  "  The  Companies  Act,  1862  " 
(ch.  89,  L.  1862),  and  its  various  amendments.  Seven  or  more  may 
incorporate  for  any  lawful  purpose  with  or  without  a  limited  liability. 
The  amount  of  liability  may  be  fixed  by  the  memoranda  of  association 
which  correspond  to  the  American  articles  of  incorporation,  §  7.  If 
the  liability  is  limited  the  word  **  limited"  is  to  be  affixed  to  the  com- 
pany's name,  §  8.  The  articles  of  association,  i.  e,,  by-laws,  may  be  re- 
corded. If  no  by-laws  are  enacted,  certain  by-laws  specified  in  the 
statute  shall  apply,  §  15.  The  by-laws  are  to  be  signed  by  each  member, 
§  16.  No  notice  of  any  trust  of  stock  shall  be  received  or  accepted  by 
the  company,  §  30.  The  register  of  members  shall  be  open  to  inspec- 
tion, 15  32.  The  register  may  be  closed  by  the  company  for  thirty  days, 
§  33.  A  person  refused  registry  may  have  his  right  determined  by  a 
motion  in  a  court j  and   the  court  may  order  any  rectification  of  the 


f( 


§  57 


ENGLAND. 


144 


registry,  on  such  motion  by  an  aggrieved  party,  §  35.  Transferers  are 
not  liable  upon  the  insolvency  of  the  company,  if  the  transfer  was  a 
year  previous  thereto.  The  liability  of  members  is  fixed  by  the  articles 
of  incorporation.  Corporate  contracts  may  be  made  relieving  the  mem- 
bers from  liability,  §  38.  Banking  and  insurance  companies  may  be 
incorporated  hereunder,  and  must  publish  statements,  §  44.  If  the 
members  become  less  than  seven,  and  remain  so  for  a  certain  time,  the 
members  are  liable  as  partners,  §  48.  The  charter  and  by-laws  may 
be  amended,  §  50.  Every  member  has  one  vote,  unless  there  is  a 
provision  otherwise,  §  52.  Elaborate  provisions  are  made  as  to  the 
winding  up  of  companies,  §§  74-173. 

A  complete  and  skillfully  drawn  set  of  by-laws  are  appended  to  the 
statute.  Any  company  is  at  liberty  to  accept  and  adopt  these  by-laws 
or  to  enact  different  ones.  But  unless  the  company  otherwise  elects  the 
following  by-laws  shall  be  its  by-laws.  (See  "  First  Schedule,"  ch.  89,  L. 
1862.)  If  several  own  stock  jointly,  any  one  may  receive  the  dividend. 
Paid-up  shares  may  be  converted  into  stock.  One-fifth  in  number  of 
the  members  may  cause  a  meeting  to  be  held.  Notice  of  the  time, 
place  and  special  business  of  all  meetings  must  .be  given.  "  All  busi- 
ness shall  be  deemed  special  that  is  transacted  at  an  extraordinary 
meeting,  and  all  that  is  transacted  at  an  ordinary  meeting,  with  the  ex- 
ception of  sanctioning  a  dividend  and  the  consideration  of  the  accounts, 
balance  sheets,  and  the  ordinary  reports  of  the  directors."  "  Every 
member  shall  have  one  vote  for  every  share  up  to  ten  ;  he  shall  have 
an  additional  vote  for  every  five  shares  beyond  the  first  ten  shares  up 
to  one  hundred,  and  an  additional  vote  for  every  ten  shares  beyond 
the  first  hundred  shares."  If  stock  is  owned  jointly,  the  first  name  on 
the  register  votes  it.  Stock  must  have  been  owned  for  three  months 
before  an  election  in  order  to  be  voted.  A  form  of  proxy  is  given. 
A  book  stating  the  condition  of  the  corporation  is  to  be  open  to  inspec- 
tion. Directors  may  be  rt.Tioved  by  the  stockholders.  Many  other 
provisions  are  contained  in  this  statute. 

In  1867  the  above  act  was  amended  by  "  The  Companies  Act,  1867," 
ch.  131,  L.  1867.  By  its  provisions  the  liability  of  directors  in  a  lim- 
ited company  may  be  made  unlimited,  §§  4-8.  Stock  subscribed  for  is 
to  be  paid  for  in  cash,  "  unless  the  same  shall  have  been  otherwise 
determined  by  a  contract  duly  made  m  writing,  and  filed  with  the  re- 
gistrar of  joint  stock  companies  at  or  before  the  issue  of  such  shares," 
§  25.  Transfers  are  made  on  the  applicatioo  of  the  transferer,  the  same 
as  if  made  by  the  transferee,  §  26.  The  company  is  liable  for  making 
transfers  without  the  delivery  of  the  share  warrant,  i.  e.,  certificate  of 
stock,  §  29.     Upon  the  issue  of  the  warrant,   the  holder's    name  is 


144 


145 


ENGLAND. 


§  57 


y.  §  35-  Transferers  are 
ly,  if  the  transfer  was  a 
)ers  is  fixed  by  the  articles 
e  made  relieving  the  mem- 
irance  companies  may  be 
statements,  §  44.  If  the 
so  for  a  certain  time,  the 
charter  and  by-laws  may 
;  vote,  unless  there  is  a 
ions  are  made  as  to  the 

,r-laws  are  appended  to  the 

and  adopt  these  by-laws 

npany  otherwise  elects  the 

First  Schedule,"  ch.  89,  L. 

may  receive  the  dividend. 

:.     One-fifth  in  number  of 

;ld.     Notice  of  the  time, 

ist  be  given.     ♦*  All  busi- 

icted  at  an   extraordinary 

nary  meeting,  with  the  ex- 

iideration  of  the  accounts, 

the  directors."     "Every 

up  to  ten  ;  he  shall  have 

nd  the  first  ten  shares  up 

every  ten  shares  beyond 

jointly,  the  first  name  on 

1  owned  for  three  months 

^  form  of  proxy  is  given. 

on  is  to  be  open  to  inspec- 

tockholders.     Many  other 

"he  Companies  Act,  1867," 
ility  of  directors  in  a  lim- 
!.  Stock  subscribed  for  is 
hall  have  been  otherwise 
ng,  and  filed  with  the  re- 
the  issue  of  such  shares," 
of  the  transferer,  the  same 
ipany  is  liable  for  making 
warrant,  i.  e.,  certificate  of 
nt,   the  holder's    name   is 


stricken  out  of  the  list  of  members  of  the  company,  §  31.  But  the  by- 
laws may  permit  the  holder  to  have  the  privii- jes  of  membership,  ex- 
cept that  of  holding  office,  §  30.  "  Every  prospectus  of  a  company, 
and  every  notice  inviting  persons  to  subscribe  for  shares  in  any  joint 
stock  company  shall  specify  the  dates  and  the  names  of  the  parties  to 
any  contract  entered  into  uy  the  company,  or  the  promoters,  directors 
or  trustees  thereof,  before  the  issue  of  such  prospectus  or  notice, 
whether  subject  to  adoption  by  the  directors  or  the  company  or  other- 
wise, and  any  prospectus  or  notice  not  specifying  the  same  shall  be 
deemed  fraudulent  on  the  part  of  the  promoters,  directors  and  officers 
of  the  company,  knowingly  issuing  the  same  as  regards  any  person 
taking  shares  in  the  company  on  the  faith  of  such  prospectus,  unless  he 
shall  have  had  notice  of  such  contract,"  §  38.  Unlimited  companies 
may  change  to  limited  companies,  ch.  76,  L.  1879.  Stockholders  in 
banks  are  always  liable  for  outstanding  bank  notes.  Id .  For  other  minor 
amendments  see  ch.  104,  L.  1870;  ch.  26,  L.  1877;  ch.  19,  L.1880; 
ch.  28;  L.  1883. 

Re-organizations  of  insolvent  companies  may  be  had  without  the 
foreclosure  of  the  mortgages  by  a  plan  adopted  by  a  three-fourths  vote 
of  the  creditors  approved  b;'  a  court,  ch.  104,  L.  1870. 

"A  company  limited  by  guaiantee"  is  wheia  the  members  agree  to 
pay  a  specified  sum  to  liquidate  corporate  debts,  upon  a  winding  up, 
see  ch.  89,  L.  1862,  Form  B.     Such  companies  may  or  may  not  have  a 
,  capital  stock,  see  Id.,  Form  C. 

The  stannaries  means  the  stannaries  of  Devon  and  Cornwall,  and  in- 
clude both  counties.  The  stannaries  court  is  a  court  in  those  two 
counties  only.  All  actual  working  mines  within  the  jurisdiction  of  the 
stannaries  are  subject  to  the  jurisdiction  of  that  court.  See  the  Stan- 
naries Act,  ch.  19,  L.  1869. 

As  to  cost-book  companies,  see  Cook  on  Stock  and  Stockholders 
and  General  Corporation  haw,  ch.  29. 

Previous  to  1862  no  general  incorporating  act  existed  in  England. 
Special  charters  were  granted.  These  special  charters  contained 
many  provisions  which  were  the  same  in  each  charter.  Hence  in  1845 
(ch.  16,  Acts  of  1845),  a  statute  was  passed  collecting  and  containing 
certain  provisions  which  were  common  to  most  of  the  special  acts 
of  incorporation  passed  previously.  This  act  was  called  "  The  Com- 
panies' Clauses  Consolidation  Act,,  1845,"  and  was  not  for  the  purpose 
of  allowing  incorporations  under  it,  but  for  the  purpose  of  avoiding 
the  necessity  of  repeating  such  provisions  in  future  special  acts  of  in- 
corporation and  also  for  assuring  uniformity  in  the  provisions  them- 
selves.    Many  of  the  provisions  in  *.  e  Canadian  corporation  statutes, 


f 


§  57 


ENGLAND. 


U6 


and  also  in  the  English  Companies  Act  of  1862,  are  taken  from  this  act. 
Some  of  its  provisions  are  to  the  following  effect  :  A  transfer  of  shares 
by  death,  bankruptcy,  insolvency  or  marriage,  or  otherwise  than  by  the 
usual  transfer,  must  be  proved  to  the  company  l)y  certain  papers,  §  18. 
Trusts  need  not  be  protected  by  the  company.  One  joint  owner  of 
slock  may  receive  dividends,  g  20.  Interest  is  to  be  paid  on  unpaid 
calls,  §  23.  Interest  may  be  allowed  on  subscriptions  paid  before  calls, 
§  24.  After  execution  returned  unsatisfied  against  the  corporation,  the 
court  may  order  the  debt  to  be  collected  from  any  stockholder  owing 
subscriptions,  §  36.  Shares  in  an  increased  capital  stock  are  to  be 
offered  to  old  stockholders  before  being  sold  to  the  public,  §  58.  Paid- 
up  shares  in  the  capital  of  the  company  may  be  converted  into  "a  gen- 
eral cajjital  stock,"  §  61.  Stock  mny  be  transferred  in  large  or  small 
quantities,  §  62.  Stockholders  are  entitled  to  the  same  rights  of  voting 
and  dividends  that  shareholders  have,  §  64,  One-tenth  in  interest  of 
shareholders  may  call  a  meeting,  §  70.  Voting  is  the  same  as  provided 
in  Companies'  Act,  q.  t'.,  ♦'  at  all  general  meetings,"  §  65.  The  powers  of 
meetings  of  the  shareholders  are  stated  to  be  "  the  choice  and  removal  of 
the  directors  •  *  *  and  the  increasing  or  reducing  of  their  num- 
ber, *  •  *  the  choice  of  auditors,  the  determination  as  to  the  re- 
muneration of  the  directors,  auditors,  treasurer  and  secretary,  the  de- 
termination as  to  the  amount  of  money  to  be  borrowed  on  mortgage, 
the  determination  as  to  the  augmentation  of  capital  and  the  declaration 
of  dividends,"  §  91.  Directors  may  delegate  their  powers  to  a  com- 
mittee, §  95.  Directors  may  set  apart  profits  "  to  meet  contingencies, 
or  for  enlarging,  repairing  or  improving  the  works,"  §  122.  Preferred 
stock  is  not  entitled  to  arrearages  of  preferred  dividends,  ch.  118, 
Acts  of  1863,  §  14.  Debenture  stock  may  be  issued  on  a  three-fifths 
vote,  §  22.  Debenture  stock  bears  interest ;  is  inferior  to  mortgages 
and  bonds;  but  is  superior  to  common  or  preferred  shares  or  stock,  §  24. 
A  specified  proportion  of  debenture  holders  may  enforce  payment  of 
interest,  §  25 .  Debenture  stock  is  transferable,  like  certificates  of  stock, 
§  29.  Debenture  stock  is  not  entitled  to  vote,  nor  to  repayment  of  the 
money  which  it  represents.  It  is  entitled  to  interest  only,  §31.  Money 
raised  by  debenture  stock  can  be  applied  only  to  the  purposes  for  which 
money  raised  by  mortgage  can  be  applied,  §  32. 

Railroads. — Two  striking  peculiarities  characterize  the  English  rail- 
way laws.  One  is  that  no  general  incorporating  act  exists — a  special  char- 
ter being  necessary.  By  this  plan,  the  paralleling  of  lines,  and  the  con- 
struction of  useless  new  ones,  are  prevented,  but  a  large  Parliamentary 
expense  is  incurred,  and  new  and  legitimate  roads  are  constructed  with 
difficulty.     The  second  peculiarity  of  the  English  railway  law  is,  that  rail- 


i 


^^^ 


146 

52,  are  taken  from  this  act. 
feet  :   A  transfer  of  shares 
e,  or  otherwise  than  by  the 
ny  by  certain  papers,  §  i8. 
ny.      One   joint  owner  of 
t  is  to  be  paid  on  unpaid 
scriptions  paid  before  calls, 
igainst  the  corporation,  the 
>m  any  stockholder  owing 
d  capital  stock  are  to  be 
to  the  public,  §  58.   Paid- 
'  be  converted  into  "  a  gen  • 
nsferred  in  large  or  small 
;o  the  same  rights  of  voting 
One-tenth  in  interest  of 
ing  is  the  same  as  provided 
tings,"  §  65.  The  powers  of 
"  the  choice  and  removal  of 
or  reducing  of  their  num- 
determination  as  to  the  re- 
irer  and  secretary,  the  de- 
)e  borrowed  on  mortgage, 
capital  and  the  declaration 
te  their  powers  to  a  com- 
ts  "to  meet  contingencies, 
works,"  §  122.      Preferred 
jferred   dividends,  ch.  118, 
be  issued  on  a  three-fifths 
;   is  inferior  to  mortgages 
eferred  shares  or  stock,  §  24. 
s  may  enforce  payment  of 
ble,  like  certificates  of  stock, 
>te,  nor  to  repayment  of  the 
interest  only,  §31.     Money 
ily  to  the  purposes  for  which 

3*- 
laracterize  the  English  rail- 

ig  act  exists — a  special  char- 

illeling  of  lines,  and  the  con- 

d,  but  a  large  Parliamentary 

;  roads  are  constructed  with 

iglish  railway  law  is,  that  rail- 


147 


ENGLAND. 


§  57 


way  mortgages  cannot  be  foreclosed.  The  creditors,  by  a  certain  vote, 
approve  a  plan  of  reorganization,  and  this  plan,  when  approved  also  by 
a  court,  is  binding  on  all  parties  concerned. 

By  ch.  20,  Acts  of  1845,  certain  provisions,  usually  inserted  in  acts, 
authorizing  the  construction  of  railways,  were  enacted  as  a  general 
statute,  for  the  purpose  of  convenience  in  embodying  them  in  subse- 
quent special  charters.  This  statute  was  called  "The  Railway  Clauses 
Consolidation  Act,  1845."  It  provides  for  laying  out  the  route,  for 
damages  for  land,  and  various  other  matters.  By  ch.  120,  Acts  of  1864, 
called  "The  Railway  Companies'  Powers  Act,  1864,"  provision  is  made 
for  the  granting  of  additional  charter  powers  to  existing  railway  com- 
panies. An  increase  of  the  capital  stock  is  therein  provided  for.  Chap- 
ter 121,  Acts  of  1864,  called  '<The  Railways'  Construction  Facilities 
Act,  1864,"  provides  for  the  incorporation  of  a  railway  company,  in  cases 
where  the  right  of  way  has  been  secured  by  contract  in  advance  of  in- 
corporation. Chapter  127,  Acts  of  1867,  called  "The  Railway  Com- 
panies'Act,  1867,"  applies  to  such  companies  generally.  It  provides 
that  where  a  railway  is  unable  to  meet  its  obligations,  it  may  file,  with  a 
court  of  chancery,  a  plan  for  recapitalization.  All  suits  may  thereby  be 
stopped.  The  plan  is  binding  on  all  the  bondholders,  when  three-quarters 
in  interest  assent.  So  also  where  three-quarters  of  the  debenture  stock- 
holders, rent-charge  holders,  and  preferred  stockholders  assent.  Assent 
by  a  meeting  of  the  ordinary  stockholders  suffices.  The  same  rule  ap- 
plies to  an  assent  by  the  lessee  of  the  railway.  The  court  may  then  con- 
firm, and  the  effect  is  the  same  as  an  Act  of  Parliament.  The  power  to 
issue  debenture  stock  is  to  be  the  same  as  in  the  Companies  Clauses  Act 
of  1863.  Chapter  1 19,  Acts  of  1868,  called  "The  Regulation  of  Railways 
Act,  1868,'  provides  that  when  a  three  percent  dividend  on  ordinary  stock 
has  been  paid,  the  ordinary  stock  may  be  divided  into  two  kinds  of 
stock:  preferred  ordinary,  and  deferred  ordinary,  each  one-half  in 
amount  of  the  old  ordinary.  The  preferred  ordinary  is  to  be  entitled  to 
a  maximum  non-cumulative  dividend  of  six  per  cent.  Various  other 
matters  are  regulated  by  this  statute.  Chapter  19,  Acts  of  1870, 
amends  the  Act  of  1864,  so  as  to  allow  those  opposing  an  application 
therein  to  be  heard. 

England,  by  many  statutes,  has  regulated  railway  charges,  and  dis- 
criminations. The  "  Railway  and  Canal  Traffic  Act  "  (ch.  25,  L.  1888), 
qpUects,  changes,  and  re-enacts  these  various  provisions,  and  is  of 
great  value  as  corresponding  to  the  American  "  Inter-state  Commerce 
Act "  of  1887. 

Taxation. — The  fee  for  the  incorporation  of  a  joint  stock  company  is 
$10,  where  the  capital   is  |io,ooo,   or  less,   ch.   89,  L.    1862,   Table 


( 


CANADA. 


148 


B.  A  small  additional  sum  is  charged  when  the  capital  is  larger,  Id. 
By  ch.  51,  L.  1885,  §11,  an  annual  stamp  tax  of  five  per  cent  is  levied 
*' upon  the  annual  value,  income  or  profits"  of  corporations,  less  "all 
necessary  outgoings,  including  the  receiver's  remuneration,  and  costs, 
charges,  and  expenses  properly  incurred  in  the  management  of  such 
property. "  A  tax  is  also  levied  upon  dividends.  Id.  g  36.  Under  2  and 
3  Will.,  iv.,  ch.  120,  railways  paid  a  tax  of  one-half  penny  per  mile,  for 
every  four  passengers  carried.  Subsequently,  the  treasury  board  were 
given  power  to  reduce  this  rate,  in  such  cases  as  they  thought  best,  and 
the  tax  has  been  modified  ".o  as  to  yield  only  1.6  per  cent  on  the  total 
gross  sum  derived  by  the  railways  from  the  passenger  traffic.  See  Jeans 
on  Railwviy  Problems,  ch.  13  (1887.)  Railways  alsopay  heavy  general 
and  local  rates  and  taxes.  Under  Acts  21  and  22  Vict.,  ch.  97,  they 
are  assfissed  for  rates  levied  under  the  Public  Health  Act,  Id.  170. 
By  the  "  Cheap  Trains  Act,  1883,"  ch.  34,  Acts  of  1883,  the  tax  on 
passenger  fares  is  reduced  or  abolished,  so  far  as  it  applies  to  the  lower 
classes  of  fares. 


■  -n 


§  58.  CANADA — By  the  "  British  North  American  Act "  (ch.  3, 
Laws  1867,  30  and  31  Vict.),  England  established  a  government  in 
Canada,  very  similar  in  its  structure  to  the  American  government. 
Cana'la  was  divided  into  four  provinces,  Ontario,-  Quebec,  Nova  Scotia 
and  New  Brunswick.  Manitoba  was  admitted  in  1870,  British  Colum- 
bia in  1871,  Prince  Edward  Island  in  1873.  Over  and  above  ail  these 
there  exists  a  federal  government,  very  similar  in  its  powers  and  func- 
tions to  the  American  national  government.  Newfoundland  is  still  a 
self-governing  Crown  colony.  The  Northwest  Territories  and  District 
of  Keewatin  are  under  the  jurisdiction  of  the  Cp.nadian  government. 
Seech.  25,  L.  1880. 

As  regards  corporations,  the  Canadian  federal  government  bap  power 
to  incorporate  and  control  all  banks,  and  interprovincial  railways,  canals, 
etc.  The  provinces,  on  the  other  hand,  have  the  power  to  incorporate 
all  companies  having  provincial  objects  (§§  91,  92,  British  North 
American  Act,  supra). 

Miscellaneous  Corporations — Bych.  119,  Rev.  Stat,  of  Canad;  1886, 
five  cr  more  may  apply  to  the  Governor  m  Council  fcr  a  char>.ei, 
for  any  purpose  ' '  to  which  the  legislative  authority  of  the  Parliament  of 
Canada  extends,  except  the  construction  and  working  of  railways,  or 
the  business  of  banking  and  the  ii.sue  of  paper  money,  or  the  business 
of  insurance."  Notice  of  the  application  must  be  publ'shed.  The 
capital  ')i  loan  companies  cannot  be  iess  than  $100,000.  A  majority  of 
the  directors  must  be  residents  in  Canada.     One-half  of  the  capital 


148 

1  the  capital  is  larger,  Id. 
{  of  five  per  cent  is  levied 
"  of  corporations,  less  "  all 
,   remuneration,  and   costs, 

the  management  of  such 
ids.  Id.  §  a6.  Under  2  and 
ne-half  penny  per  mile,  for 
ly,  the  treasury  board  were 
IS  as  they  thought  best,  and 
ly  1.6  per  cent  on  the  total 
assenger  traffic.  See  Jeans 
irays  also  pay  heavy  general 

and  22  Vict.,  ch.  97,  they 
3lic  Health  Act,  Id.  170. 
Acts  of  1883,  the  tax  on 
ar  as  it  applies  to  the  lower 


th  American  Act"  (ch.  3, 
itablished  a  government  in 
the  American  government, 
ntario,  Quebec,  Nova  Scotia 
ed  in  1870,  British  Colum- 
Over  and  above  ail  these 
lilar  in  its  powers  and  func- 
t.  Newfoundland  is  still  a 
irest  Territories  and  District 
[  the  Canadian  government. 

;deral  government  ha?  power 
erprovincial  railways,  canals, 
ive  the  power  to  incorporate 
(§§    91,    92,  British   North 

),  Rev.  Stat,  of  Canad;  1886, 
r  m  Council  for  a  char^ei, 
uthority  of  the  Parliament  of 
and  working  of  railways,  or 
aper  money,  or  the  business 
n  must  be  published.  The 
an  $ioo,oco.  A  majority  of 
la.     One-half  of  the  capital 


149 


CANADA. 


§  58 


stock  is  to  be  taken  before  incorporation  and  ten  per  cent  paid  in,  and  at 
least  $100,000  is  to  be  paid  in  by  loan  cor|wrations.  Bonds  may  be 
issued  on  a  two-thirds  vote  of  the  stock,  but  the  money  borrowed  shall 
not  exceed  seventy-five  per  cent  of  the  paid-up  capital,  unless  a  dis- 
counting business  is  done.  A  stock  book  is  to  be  open  to  inspection. 
Directors  are  liable  for  allowing  transfers  to  persons  apparently  irre- 
sponsible. Directors  may  apply  to  a  court  when  in  doubt  as  to  who 
is  entitled  to  stock  transfers.  Stockholders  are  not  liable  beyond  their 
unpaid  subscriptions.  Notices  may  be  served  on  members  personally 
or  by  registered  letter.  No  loans  to  shareholders  are  allowed,  except 
by  loan  companies.  Directors  are  liable  to  laborers,  etc.,  for  six  months' 
wages.  One-fourth  of  the  stock  may  call  a  meeting  at  any  time.  The 
word  "  limited  "  must  be  affixed  to  the  corporate  name  under  penalty 
of  fine  for  omission.  When  shares  are  issued  for  property  by  contract 
the  contract  is  to  be  filed  with  the  secretary  of  state.  A  prospectus 
must  state  all  contracts  with  promoters,  etc.  Debenture  stock  may  be 
issued  by  loan  companies.  This  stock  is  not  entitled  to  a  vote,  and  is  prac- 
tically a  debt  of  the  company  payable  at  any  time  at  the  option  of  the 
company,  but  payment  can  never  be  enforced  by  the  holder.  It  bears 
interest  and  is  transferable,  ch.  20,  L.  1887.  Trusts  and  combinations 
are  forbidden  under  the  criminal  law,  ch.  41,  Acts  of  1889. 

Railways.— By  ch.  109,  Rev.  Stat.,  1886,  railways  may  unite,  §  6. 
Rates  may  be  reduced  when  the  net  income  for  the  past  year  exceeds  fif- 
teen per  cent  of  the  actual  cost  of  the  property,  with  interest  for  the  years 
when  no  dividend  was  declared,  §  16.  The  form  of  proxies  is  prescribed, 
§18.  Directors  must  obey  the  orders  and  directions  of  stockholders' 
meetings,  Id.  "  No  person  holding  any  office,  place  or  employment 
in,  or  being  concerned  or  interested  in  any  contracts  under  or  with  the 
company,  shall  be  capable  of  being  chosen  a  director,  or  of  holding  the 
office  of  director,  nor  shall  any  person,  being  a  director  of  the  company, 
enter  into,  or  be  directly  or  indirectly,  for  his  own  use  and  benefit,  in- 
terested in  any  contract  with  the  company,  not  relating  to  the  purchase 
of  land  necessary  for  the  railway,  or  be  or  become  a  partner  of  any 
contractor  with  the  company,'"  Id.  Overdue  calls  bear  interest,  §  19. 
The  form  of  transfers  of  stock  is  prescribed,  §  22.  In  case  of  transfer, 
other  than  by  sale,  a  copy  of  the  will  or  other  instrument  must  be 
filed.  The  company  need  not  protect  trusts  of  stock.  The  company 
cannot  buy  its  own  stock  or  stock  in  other  companies,  Id.  Traffic 
contracts  may  be  made  uiron  the  approval  of  the  Governor  in  Council, 
§  56.  No  railway  company  shall  buy  its  own  stock,  or  stock  in  other 
railway  companies,  unless  already  authorized,  g  89. 

Banks By  ch.    120,  Rev.   Stat.,  1886,  banks  shall  not  commence 


F 


MiiifaU 


69 


QUEBEC. 


160 


business  uiUil  $500,000  capital  stock  has  been  subscribed  and  $100,000 
paid  in,  $100,000  mure  tu  l)e  paid  in  within  twu  years.  'I'he  remainder 
may  remain  uncalled,  |$  6.  Paper  money  issued  is  not  to  exceed  its 
paid-up  capital,  g  40.  No  dividend  over  eijjht  per  cent  unHl  twenty  per 
cent  reserve  over  bad  del)ts  is  obtained,  H  28.  Ten  per  cent  must  be 
paid  within  thirty  days  after  suliscribing,  §  20.  Tr  insfers  by  death, 
bankruptcy  or  insolvency,  or  otherwise  than  regular,  must  be  proven  to 
the  company,  ^  32.  A  female  stockholder  who  marries  may  have  the 
stock  entered  as  her  seiiarate  estate,  JJ  33.  The  company  may  apply  to 
the  courts,  in  case  of  doubt  as  to  the  title  to  stock,  g  36.  The  bank 
need  not  preserve  trusts  of  stock,  g  37.  Director  must  own  from 
'  $3,000  to  $5,000  of  stock  in  order  to  be  eligible,  according  to  the 
amount  of  capital  stock,  §  9.  Directors  must  be  natural-born  or  nat- 
uralized subjects  of  the  Queen,  §  12.  Shareholders  are  not  allowed  to 
inspect  personal  accounts,  but  the  directors  may,  §  25.  The  bank 
shall  not  take  its  stock  in  pledge,  g  45.  Stockholders  are  liable  to  cor- 
porate creditors  to  the  extent  of  the  par  value  of  their  stock  in  addition 
to  the  subscription  price,  ^  70.  Directors  may  assess  stock  to  pay  lia- 
bilities six  months  past  due,  §  72.  Transferers  within  one  month  pre- 
vious thereto,  are  also  liable  thereon,  §  77.  The  bank  has  a  lien  on  stock 
for  the  debts  of  stockholders,  §  59.  Proxies  can  be  given  only  to  stock- 
holders and  never  to  the  manager,  cashier  or  other  employe  of  the 
bank,  §  10.  Any  director  or  the  president  or  vice-president  may  be  re- 
moved by  a  vote  of  the  stockholders,  g  II.  Proxies  more  than  three 
years  old  are  void,  §14. 

§50.  QUEBEC.  MiiMsellaneoasCorporatlong.  — Five  or  more  may  peti- 
tion the  governor-general  for  a  charter  for  any  purpose  within  the  juris- 
diction of  the  province,  except  to  construct  and  work  railways  and  for 
insurance,  see  ch.  11,  L.  1881.  A  notice  of  the  application  for  the  char- 
ter must  be  published,  Id.  One-half  of  the  stock  must  be  taken  before 
incorporation,  and  five  per  cent  of  the  whole  capital  paid  in,  ch.  25,  L. 
1868.  The  petition  for  a  charter  may  ask  for  special  provisions  there- 
in, Id.  Charters  may  be  amended.  A  majority  of  directors  are  to  be 
residents  and  subjects.  Directors  are  to  transact  the  business  and 
make  contracts,  etc.,  and  declare  dividends,  etc.  One-fourth  in  value 
of  the  stock  may  call  meetings.  Directors  are  liable  for  allowing 
transfers  to  persons  not  apparently  able  to  respond.  The  stock  book 
is  to  be  open  to  inspection.  Trusts  in  stock  are  not  protected.  The 
corporation  is  not  to  buy  stock  in  other  companies.  Stockholders  are 
not  liable  to  corporate  creditor,  beyond  the  amount  of  their  respective 
shares.     No  loans  to  stockholders  are  allowed.     Directors  are  liable 


160 

Huhscribed  and  $100,000 
o  years.  The  remainder 
lied  is  not  to  exceed  it» 
;  per  cent  unMl  twenty  per 
Ten  per  cent  must  be 
o.  Trinsfers  by  death, 
:}rular,  must  be  proven  to 
i^ho  marries  may  have  the 
le  company  may  apply  to 

stock,  g  36.  The  bank 
Director  must  own  from 
igible,  according  to  the 
t  be  natural-born  or  nat- 
>lders  are  not  allowed  to 

may,  g  25.  The  bank 
holders  are  liable  to  cor- 
of  their  stock  in  addition 
|r  assess  stock  to  pay  lia- 
;rs  within  one  month  pre- 
le  bank  has  a  lien  on  stock 
in  be  given  only  to  stock- 
)r  other  employe  of  the 
vice-president  may  be  re- 
Proxies  more  than  three 


I.  —  Five  or  more  may  peti- 
purpose  within  the  juris- 
nd  work  railways  and  for 
2  application  for  the  char- 
ock  must  be  taken  before 
capital  paid  in,  ch.  25,  L. 
r  special  provisions  there- 
ity  of  directors  are  to  be 
ansact  the  business  and 
:tc.  One-fourth  in  value 
I  are  liable  for  allowing 
spond.  The  stock  book 
are  not  protected.  The 
^nies.  Stockholders  are 
nount  of  their  respective 
ed.     Directors  are  liable 


151 


NOVA  HCOTIA, 


§  60 


to  laborers,  etc.,  for  six  months'  wages,  Id.  Until  half  of  the  capital 
stock  is  paid  in,  calls  of  ten  per  cent  for  the  fust  year,  and  five  per  cent 
annually  thereafter  are  to  be  made,  ch.  34,  L.  1868.  The  capital  stock 
is  that  jwrtion  of  the  authorized  capital  that  is  siihscribeil  for  and 
allotted,  ch.  73,  L.  1884.  "  No  stock  shall  be  issued  to  represent  the 
increased  value  of  any  property,"  Id.  Watered  stock  is  void,  Id. 
Stock  dividends  are  void,  Id.  Stock  ••  not  represented  by  an  amount 
in  cash  paid  into  the  treasury  of  the  company,  which  has  been  expended 
for  tl)e  promotion  of  the  objects  of  the  company  "  is  void,  Id.  t'orpo- 
rations  of  Great  Britain  or  of  the  United  States  may  accjuire  and  hold 
land  in  this  province,  ch.25,  L.  1872. 

Rallwajrg. — See  ch.  43,  L.  1880.  One-half  in  interest  of  the  stock- 
holders may  cause  a  meeting  to  be  called.  A  form  of  proyy  is  pre- 
scribed. Directors  are  subject  to  the  examination  and  control  of  stock- 
holders' meetings  and  to  their  orders  and  directions.  Directors  are  not 
to  be  interested  in  contracts  with  the  company.  Stockholders  declare 
dividends,  in  meeting  assembled.  "Shares  in  the  undertaking  may,  by 
the  parties,  be  sold  and  disposed  of  by  instrument  in  writing,  to  be 
made  in  duplicate,  one  part  of  which  shall  be  delivered  to  the  directors 
to  be  filed  and  kept  for  the  use  of  the  company,  and  an  entry  thereof 
shall  be  made  in  a  book  to  be  kept  for  that  purpose."  The  form  of 
sale  is  prescribed.  The  transmission  of  shares,  other  than  by  transfer, 
must  be  proven  to  the  company.  Trusts  in  stock  are  not  protected  by 
the  company.  The  company  is  not  to  purchase  its  own  or  any  other 
stock.  Contracts  for  the  construction  or  maintenance  of  the  road  must 
be  advertised  four  weeks  for  bids.  The  com|)any  need  not  accept  any 
of  the  bids.  The  company  may  make  traffic  contracts  on  a  two-thirds 
vote  of  the  stock.  Amalgamations  must  be  approved  by  the  govern- 
ment. 

Taxation. — Banks  are  taxed  $100  for  every  $100,000  of  capital  up 
to  $1 ,000,000,  and  a  smaller  tax  for  capital  in  excess  thereof.  Insur- 
ance companies  are  taxed  $500  for  one  kind  of  insurance,  and  $50  ad- 
ditional for  each  other  kind.  Miscellaneous  corporations  pay  one- 
tenth  of  one  per  cent  of  the  capital  up  to  $1,000,000  and  a  less  tax  for 
any  excess.  Loan  companies  pay  a  graduated  tax.  Railways  pay  $5 
a  mile,  and  $10  a  mile  if  they  are  receiving  a  subsidy,  ch.  11,  L.  1880. 

§  60.  NOVA  SCOTIA— Stockholders  are  liable  for  corporate  debts. 
"  Each  member  thereof  shall  be  liable  as  a  partner  to  the  same  extent 
as  if  no  corporation  existed,"  unless  the  special  act  granting  the  char- 
ter provides  otherwise.  Execution  returned  unsatisfied  against  the  cor- 
poration may  be  levied  on  the  stockholders'  property,  Rev.  Stat.,  1884 


60 


NOVA  SCOTIA. 


159 


ch.  78,  §  13.     Directuis  are   liable   for  corporate  debts  in  excess  of 
■tock  sul)Ncril)ed,  unless  the  company  prescribes  otherwise,  Id.  |$  14. 

MlMcellaneous  Corporations. — May  be  incorporated  for  any  pur|X)!ie 
over  which  the  province  has  power,  except  constructing  and  work- 
ing railways,  loaning,  etc.  Incorporation  is  granted  by  the  (lover- 
nor  in  Council,  Id.  ch.  79.  Previous  notice  of  the  intent  to  apply 
for  a  charter  must  be  advertised.  'I'he  company  on  a  two-thirds 
vote  may  apply  for  more  extended  powers.  A  majority  of  the  directors 
must  reside  in  the  province.  Elections  are  to  be  held  in  the  province. 
One-fourth  in  value  of  the  stockholders  may  call  a  cor|K)rate  meeting. 
Stock,  it  seems,  may  be  issued  below  par.  The  stock  book  is  to  be  open 
to  ins|)ection.  Transferers  and  unrecorded  transferees  are  both  liable 
on  stock.  If  the  ownership  to  stock  is  in  doubt,  the  company  may  ap- 
ply to  a  court  for  decision.  Transferees  are  liable  on  subscriptions. 
The  company  h  not  bound  to  protect  stock  held  in  trust.  Officers  are 
liable  for  loans  to  stockholders.  The  incorporation  fee  is  #30  if  the 
capital  stor.!;  is  under  licooo.  It  varies  upward  and  is  $70  if  the  capi- 
tal is  ove  •  f 500, 000.  Stockholders  are  not  liable  for  corjiorate  debts 
except  to  the  extent  of  unpaid  subscriptions.  The  word  "  limited  "  is  to 
be  used.  An  omission  subjects  the  company  and  officers  to  a  penalty. 
Stock  is  to  be  paid  for  in  cash  unless  the  contract  whereby  it  is  issued 
for  property  is  registered  with  the  provincial  secretary.  Bonds  may  be 
issued  on  a  vote  of  two-thirds  in  interest  of  the  stockholders,  Id.,  ch.  79. 
*  Railwnys. — Cannot  unite  except  upon  the  approval  of  the  (lovernor 
in  Council,  Id.,  ch.  53,  §  7  (15).  Votes  are  to  be  in  proportion  to 
shares.  Id.  §  19.  A  form  of  proxy  is  prescribed.  Directors  are  sub- 
ject to  the  examination  and  control  of  stockholders  at  annual  meetings, 
and  must  obey  the  orders  of  the  stockholders  at  any  meeting.  Direc- 
tors shall  n  ot  be  interested  in  contracts  with  the  company.  Persons 
holding  office,  in  one  company  interested  in  contracts  with  another  com- 
pany are  not  eligible  for  directorship  in  the  latter,  Id.  For  non-payment  of 
calls  the  company,  at  a  general  meeting,  may  declare  stock  forfeited, 
Id.  8  20.  General  meetings  of  stockholders  determine  the  question  of 
dividends,  Id.  §  31.  A  form  of  transfer  of  stock  is  prescribed.  Trans- 
fers by  death,  bankruptcy,  will,  donation  or  testament,  or  intestacy,  must 
be  shown  by  a  copy  of  the  instrument.  The  company  is  not  respons- 
ible for  the  preservation  of  stock  held  in  trust.  The  company  shall  not 
purchase  its  own  or  any  other  stock.  Id.  §  22.  Traffic  contracts  are 
valid  if  two-thirds  of  the  stockholders  assent.  Amalgamations  are  legal 
only  upon  the  assent  of  the  Governor  in  Council,  Id.  §  58.  When  a 
company  wishes  to  reorganize  by  arrangement  between  it  and  its  credit- 
ors, any  scheme  assented  to  by  three-fourths  in  value  of  the  creditors 


,«■ 


) 


152 

)()ratc   debts  in  excess  of 
bes  otherwise,  Id.  ^  14. 
rporated  for  any  ptir]X)8e 
constructing  and   work- 
s  granted   by   the  (lover- 
of  the  intent   to   apply 
jnipany  on    a    two-thirds 
majority  of  the  directors 
l)e  held  in  the  province, 
call  a  cor|M)rate  meeting. 
le  stock  book  is  to  be  open 
ransferees  are  both  liable 
iibt,  the  company  may  ap- 
!  liable  on    subscriptions, 
leld  in  trust.     Officers  are 
urporation  fee  is  lao  if  the 
ard  and  is  1^70  if  the  capi- 
liable  for  corjiorate  debts 
rhe  word  "  limited  "  is  to 
and  officers  to  a  penalty, 
tract  whereby  it  is  issued 
secretary.     Bonds  may  be 
e  stockholders,  Id.,  ch.  79. 
J  approval  of  the  Oovernor 
!   to   be   in  proportion   to 
ribed.     Directors  are  sub- 
olders  at  annual  meetings, 
i  at  any  meeting.     Direc- 
th  the  company.     Persons 
ontracts  with  another  com- 
;r,  Id.  For  non-payment  of 
y  declare  stock  forfeited, 
determine  the  question  of 
ock  is  prescribed.     'I'rans- 
stament,  or  intestacy,  must 
company  is  not  respons- 
.     The  company  shall  not 
22.     Traffic  contracts  are 
Amalgamations  are  legal 
auncil.  Id.  §  58.     When  a 
:  between  it  and  its  credit- 
in  value  of  the  creditors 


158 


ONTARIO. 


««t 


affected,  and  three-fourths  in  value  of  each  class  of  preference 
stockholders,  and  by  a  s|)ecially  called  meeting  of  the  orilin- 
ary  stockholders,  and  by  a  court  is  thereby  confirmed  and  established, 
Id.  ch.  54.  Municipalities,  on  a  majority  vote  of  all  the  ratepayers,  may 
aid  railroads.  Id.  ch.  55. 

§  Gl.  NEW  BRUNSWICK.— Five  or  more  may  incorixirate  for  any 
pur|xjse  except  constructing  and  working  railways,  insurance  and  char- 
itable, etc.,  pur|X)ses,  ch.  9,  I..  1885.  Must  advertise  a  notice  of  the 
intent  to  apply  for  a  charter,  unless  the  capital  stock  is  $5,000  or  less 
The  attorney-general  must  approve  of  the  incorporation.  'I'he  capital 
stock  is  not  to  be  less  than  $3,000  actually  subscribed.  The  lieutena  't- 
governor  in  council  grants  the  charter.  At  meetings  all  questions  are 
decided  by  a  majority  of  the  stock  voted.  Directors  are  to  control  the 
making  of  contracts.  The  company  may  issue  bonds  for  borrowed 
money  on  a  two-thirds  vote  of  all  the  stock.  One-fourth  of  the  stock 
may'call  a  meeting.  The  stock  book  shall  be  oi)en  to  ins|)ection.  The 
company  is  not  bound  to  nrotect  stock  held  in  trust.  Stockholders  are 
not  liable  for  corjwrate  aebts,  except  to  the  extent  of  the  unpaid  sub- 
scriptions. The  company  shall  not  purchase  the  stock  of  another  com- 
pany unless  authorised  by  the  stockholders.  No  watered  stock  or 
stock  to  represent  the  increased  value  of  the  corporate  |)roperty  shall 
be  issued.  Loans  to  stockholders  are  prohibited.  Stock  must  be  paid 
for  in  cash,  unless  the  contract  to  issue  for  property  is  in  writing  and  is 
filed  in  the  provincial  secretary's  office.  Prospectuses  must  state  all 
contracts  between  promoters,  etc.,  and  the  company.  Directors  are  to 
make  annual  reports.  Shares  of  stock  and  income  from  stock  are  not 
taxed  when  the  company  is  taxed  on  its  property,  Consol.  Stat.,  1876, 
p.  80,3.  The  corporation  is  taxed  on  its  tangible  personalty,  on  its 
realty  and  on  its  paid-up  capital  stock,  less  the  valuation  of  its  realty. 
Id.  Foreign  corporations  are  taxed  on  their  tangible  personalty  and  on 
their  income  within  the  province.  Id.  Shares  of  stock  are  subject  to 
execution.  Id.  p.  750. 

§  62.  ONTABIO.  Joint  Stock  ConnpanleB.— Five  or  more  may  peti- 
tion for  a  charter  for  any  business  within  the  legislative  authority  of  the 
legislature  of  Ontario,  excepting  the  construction  and  working  of  rail- 
ways and  the  busines.  of  insurance,  p.  1444.  The  notice  of  application 
must  be  published.  The  lieutenant-governor  may  dispense  with  publi- 
cation if  the  capital  stock  is  $3,000  or  less,  pp.  1445,  1446.  The  charter 
may  be  amended  on  a  two-thirds  vote,  p.  1450.  Elections  are  to  be  held 
with  the  province,  p.  145 1.     The  directors  may  make  the  by-laws,  p. 


I 


Wi 


§  63 


BRITISH  COLUMBIA. 


154 


1452.  On  a  two-thirds  vote  of  the  stockholders,  bonds,  etc.,  may  be 
issued,  p.  1453.  One-fourth  in  interest  of  tlie  stock  may  call  meetings, 
Id.  No  salaries  or  payments  are  to  be  made  to  a  director  or  president 
unless  the  stockholders  authorize  them,  p.  1453.  The  stcck  book  is  to 
be  open  to  inspection,  p.  1455.  The  company  is  not  responsible  for 
trusts  in  stock,  p.  1458.  The  company  shall  not  purchase  stock  in 
other  companies  unless  the  stockholders  authorize  it.  Id.  Stockholders 
are  not  liable  except  for  their  unpaid  subscription,  p.  1459.  Loans  to 
stockholders  are  forbidden,  p.  1460.  Directors  are  liable  for  one  year's 
wages  to  laborers,  Id.  In  certain  corporations  a  majority  of  the  direc- 
tors must  be  residents  and  subjects,  p.  1436.  Preferred  stock  may  be 
issued  by  order  of  a  stockholders'  meeting,  p.  1449. 

Railways. — There  is  no  general  incorporating  act.  The  form  of 
proxies  is  prescribed.  The  proxy  extends  to  any  business  that  may  come 
before  the  meeting.  Id.  p.  1657.  Directors  are  not  to  be  interested  in 
contracts  with  the  corporation,  p.  1658.  Directors  must  obey  the  orders 
of  the  stockholders,  Id.  Stockholders  are  to  determine  whether  a  divi- 
dend shall  be  declared,  p.  1661.  The  form  of  a  transfer  of  stock  is  given, 
p.  1662.  Municipalities  may  subscribe,  p.  1663.  Trusts  in  stock  need 
not  be  protected  by  the  company,  p.  1662.  Company  shall  not  pur- 
chase its  own  or  any  other  stock,  p.  1663.  Contracts  for  construction 
or  maintenance  mast  be  advertised  for  bids,  but  bids  need  not  be  ac- 
cepted, p.  166&.  Traffic  contracts  may  be  made  on  a  two-thirds  vote 
of  the  stockholders,  p.  1677. 

Shares  of  stock  tnd  dividends  from  bank  stock  are  taxed.  Rev.  Stat, 
of  1887,  pp.  2084,  2088.  Bank  stock  itself  is  not  taxed,  p.  2088.  Rail- 
road stock  is  not  taxed,  but  a  tax  is  levied  on  the  income  therefrom.  Id. 
The  corporation  is  taxed  on  its  personalty,  p.  2100.  if  most  of  the  cap- 
ital stock  of  certain  public  corporations  is  invested  in  realty,  its  personalty 
is  not  taxed,  p.  2100.  Non-resident  stockholders  are  not  taxed,  p. 
2099. 


m 


§  63.  BRITISH  COLUMBIA — Corporations  maybe  formed  for  any 
Kwful  purpose  within  the  powers  of  the  province,  Consol.  Acts,  1888,  ch. 
21,  §  12.  Three  or  more  may  incorporate  by  filing  a  certificate,  §  13. 
A  director  may  be  removed  by  two-thirds  of  the  directors,  or  by  one-half 
together  with  two-thirds  in  interest  of  the  stockholders,  §  16.  The  debts 
shall  not  exceed  the  paid-in  capital,  §  17.  Two-thirds  in  interest  of  the 
stockholders  must  assent  10  borrowing  or  mortgaging;  Id.  The  com- 
pany shall  not  issue  money,  §  19.  Directors  creating  debts  in  excess 
of  paid-in  capital  are  liable  therefor,  §  26.  Proxies  must  be  attested  by 
a  witness,  §  31.     The  register  book  is  to  be  open  to  the  inspection  of 


4.  164 

lolders,  bonds,  etc.,  may  be 
he  stock  may  call  meetings, 
e  to  a  director  or  president 
453.  The  stock  book  is  to 
)any  is  not  responsible  for 
hall  not  purchase  stock  in 
horize  it,  Id.  Stockholders 
ription,  p.  1459.  Loans  to 
:ors  are  liable  for  one  year's 
ons  a  majority  of  the  direc- 
i.  Preferred  stock  may  be 
).  1449. 

orating  act.  The  form  of 
any  business  that  may  come 
are  not  to  be  interested  in 
rectors  must  obey  the  orders 
o  determine  whether  a  divi- 
if  a  transfer  of  stock  is  given, 
[663.  Trusts  in  stock  need 
Company  shall  not  pur- 
Contracts  for  construction 
,  but  bids  need  not  be  ac- 
made  on  a  two-thirds  vote 

stock  are  taxed.  Rev.  Stat, 
s  not  taxed,  p.  2088.  Rail- 
n  the  income  therefrom.  Id. 
.  2100.  li  most  of  the  cap- 
ested  in  realty,  its  personalty 
cholders  are  not  taxed,  p. 


ons  may  be  formed  for  any 
nee,  Consol.  Acts,  1888,  ch. 
ay  filing  a  certificate,  §  13. 
:he  directors,  or  by  one-half 
;kholders,  §  16.  The  debts 
Fwo-thirds  in  interest  of  the 
nortgaging;  Id.  The  com- 
s  creating  debts  in  excess 
Proxies  must  be  attested  by 
e  open  to  the  inspection  of 


165 


FRANCE. 


§  64 


stockholders  and  creditors,  §  54.     Shares  of  stock  and  dividends  are 
taxed,  ch.  III. 

§  G4.  FRANCE.— MIscellaneons  Corporations — These  are  formed 
under  the  law  of  Juiy  24,  1867.  By  its  provisions,  corporations  for 
any  legal  purpose  may  be  formed  without  special  authorization,  by  the 
execution  in  duplicate  of  a  deed  under  private  sea!,  Title  II.,  Art.  21  of 
S'^cieties  Anonymes.  The  name  shall  show  the  nature  of  the  business, 
L'art  30,  du  code  de  commerce.  Directors  are  only  responsible  for 
the  due  execution  of  instructions.  Id.  32,  Members  are  liable  only 
to  the  extent  of  their  interest.  Id.  33.  The  capital  is  divided  into 
equal  shares,  Id.  34.  A  transfer  of  shares  is  made  by  an  entry  on 
the  corporate  books  signed  by  the  assignor  or  his  attorney.  Id.  36. 
Managers  shall  be  shareholders  pnd  shall  choose  one  of  their  number 
to  be  director,  or  if  the  articles  permit,  may  select  an  outsider  for 
whose  acts,  however,  they  are  responsible,  L.  of  1867,  Title  II.,  Art. 
22.  Incorporators  shall  not  be  less  than  seven,  Id.  23.  Shares  are 
not  to  be  less  than  100  francs  when  the  capital  does  not  exceed 
200,000  francs,  nor  less  than  500  francs  when  it  does.  The  organiza- 
tion cannot  be  completed  until  the  whole  capital  is  subscribed  and  at 
least  one-fourth  of  each  share  paid  up.  The  manager  shall  make  a 
sworn  statement  of  the  subscriptions  and  paymeius  to  which  is  annexed 
a  duplicate  copy  of  the  articles.  Id.,  Title  I.,  Art.  i.  Shares  are  nego- 
tiable when  one-fourth  has  been  paid  thereon.  Id.  Art.  2.  The  articles 
may  provide  for  the  conversion  of  shai'es,  Oiie-half  paid  up,  into  shares 
payable  to  bearer.  In  any  case  the  original  subscribers,  together  with 
their  assignees  before  payment  of  one-half,  remain  liable  for  the  full 
amount  of  the  subscription  for  two  years  after  organization,  Id.  Art.  3. 
Subscriptions  other  than  money  must  be  approved  by  a  majority  present 
at  a  special  meeting,  which  majority  shall  represent  one- fourth  of  the 
stock.  Id.  Art.  4.  Except,  however,  where  the  corporators  were  pre- 
viously joint  proprietors.  Id.  A  societe  anonyme  is  deemed  formed 
from  the  acceptance  of  directorship  and  auditorship  by  the  persons  so 
chosen  at  a  general  meeting  called  for  that  purpose  subsequent  to  the 
full  subscription  and  one-fourth  payment.  Title  II.  Art.  25.  Directors 
shall  own  a  number  of  shares  specified  in  the  articles.  These  are  in 
the  name  of  the  owner  ;  are  stamped  not  negotiable,  and  are  kept  in  the 
company's  safe  as  a  guarantee  for  all  the  acts  of  the  directors,  L.  1867, 
Title  II.,  Art.  26.  The  articleb  regulate  voting.  At  the  first  general 
meeting  no  shareholder  can  have  more  than  ten  votes.  Id.  Art.  27. 
Meetings  to  amend  the  articles,  extend  the  duration  or  dissolve,  must 
represent  one-half  of  the  capital.  Id.  Art.,  31.     One  or  more  auditors, 


§  65 


GERMANY. 


150 


U 


•'    iii. 


who  may  or  may  not  be  stockholders,  are  designated  each  year  to  report 
at  the  next  meeting  on  the  condition  of  the  company's  affairs,  Id.  Art. 
32.  The  auditors  may  inspect  the  books  and  in  an  urgent  case  call 
special  meetings.  Id.  33.  Semi-annual  statements  of  the  assev  ^  and 
liabilities  and  all  other  facts  are  to  be  made  to  the  auditors  and  produced 
at  the  annual  general  meeting,  Id  34.  Lists  of  stock  and  investors 
are  open  to  the  inspection  of  stockholders  fifteen  days  before  the  meet- 
ing. Id.  35.  One-fourth  of  the  annual  net  profits  must  be  set  apart  as  a 
reserve  fund,  until  it  equals  one-tenth  of  the  capital,  Id.  36.  Provision  is 
made  for  winding  up  affairs  when  three-fourths  of  the  capital  has  been  lost 
or  the  number  of  members  reduced  below  seven.  Id.  Arts.  37,  38. 
Shareholders  representing  one-twentieth  of  the  capital  may  jointly  move 
to  bring  wrongdoing  directors  to  Justice  without  prejudice  to  the  share- 
holders' individual  right  of  action,  Id.  39.  Directors  are  not  to  be 
interested  in  corporate  transactions  except  by  express  permission.  Id,  40. 
A  failure  to  comply  with  the  provisions,  supra,  as  to  organization,  makes 
the  soci6te  null  and  void,  and  the  directors  and  implicated  promoters 
are  individually  liable,  but  not  the  stockholders,  Id.  Arts.  41,  42. 
The  auditors  are  liable  as  agents,  Id.  43,  Heavy  penalties  are  prescribed 
for  fraud  and  mismanagement,  Id.  Arts.  44,  45.  Within  one  month 
after  the  formation  of  a  company,  duplicate  articles  and  certain  affidavits 
with  stock  lists,  shall  be  filed  with  a  justice  of  the  peace,  and  tribunal 
of  commerce,  and  also  published.  But  a  failure' to  do  this  does  not 
affect  the  rights  of  third  parties,  Arts.  55,  56.  When  offices  are  kept 
in  different  arrondissements  the  filing  and  publication  are  to  be  made 
in  all.  Art.  59.  In  all  documents  and  publications  the  corporate  name 
must  be  accompanied  by  the  words  "  society  anonyme,"  and  a  state- 
ment of  the  amount  of  capital,  Art.  64. 

Elaborate  provisions  are  made  also  in  the  French  law  for  unincor- 
porated joint  stock  associations,  see  Manuel  des  Socifetes  Anonymes 
par  Albert  Charmolu,  Paris,  Marchal,  Billard  et  cie,   Editeurs,  1883. 

By  a  recent  Act  (1889),  which,  however,  has  not  yet  come  to  hand, 
the  above  act  has  been  modified,  particularly  with  a  view  to  aiding  and 
encouraging  co-operative  associations  and  coriK>rations. 


,  §  65.  GERMANY — Das  Allgemeine  Deutsche  Handelsgesetzbuch, 
(the  German  Commercial  Code),  defines  an  Aktiengesellschaft  as  a  com- 
pany all  the  members  of  which  participate  only  to  the  extent  of  fixed 
contributions  without  becoming  personally  liable  for  the  obligations  of 
the  association.  Art.  207.  The  shares  may  run  to  bea.er  cr  to  a 
particular  name,  Id.  Every  share  running  to  a  particular  name 
must  be  for  at  least  50  vereinsthaler  (about  $35),  and  those  running 


150 

gnatecl  each  year  to  report 
ompany's  affairs,  Id.  Art. 
id  in  an  urgent  case  call 
cments  of  the  assev  •  and 
the  auditors  and  produced 
s  of  stock  and  investors 
een  days  before  the  meet- 
fits  must  be  set  apart  as  a 
apital,  Id.  36.  Provision  is 
of  the  capital  has  been  lost 
seven,  Id.  Arts.  37,   38. 
e  capital  may  jointly  move 
3ut  prejudice  to  the  share- 
Directors  are  not  to  be 
express  permission,  Id.  40. 
,  as  to  organization,  makes 
and  implicated  promoters 
olders,   Id.    Arts.  41,  42. 
vy  penalties  are  prescribed 
^,  45.     Within  one  month 
tides  and  certain  affidavits 
of  the  peace,  and  tribunal 
lilure'todo  this  does  not 
6.     When  offices  are  kept 
}ublication  are  to  be  made 
ations  the  corporate  name 
e  anonyme,"  and  a  state- 
French  law  for  unincor. 
des  Soci^tes  Anonymes 
d  et  cie,   Editeurs,  1883. 
las  not  yet  come  to  hand, 
with  a  view  to  aiding  and 
rporations. 

tsche  Handelsgesetzbuch, 
ctiengesellschaftas  a  com- 
ily  to  the  extent  of  fixed 
ble  for  the  obligations  of 
lay  rim  to  bea.er  cr  to  a 
ng  to  a  particular  name 
;  $35),  and  those  running 


167 


GERMANY. 


§  65 


to  bearer,  at  least  100  thaler  (about  $70).  All  shares  for  smaller 
amounts  are  void,  and  persons  issuing  such  are  liable  as  partners. 
The  nominal  value  of  shares  cannot  be  altered  during  the  existence  of 
the  company,  Art.  207a.  The  articles  must  be  formally  executed 
and  acknowledged.  Art.  208.  The  articles  must  exhibit :  (i)  the 
corporate  style  and  domicile  ;  (2)  object  of  the  undertaking ;  (3) 
period  of  existence,  if  limited  ;  (4)  amount  of  capital  and  value  of  each 
share  ;  (5)  whether  shares  shall  be  to  name  or  to  bearer,  the  number  of 
each  kind,  and  if  at  all,  how  to  be  converted  ;  (6)  establishment  of  a 
council  of  overseers,  three  in  number,  to  be  chosen  from  the  stock- 
holders [this  is  the  only  provision  in  the  German  law  as  to  the  mini- 
mum number  of  persons  who  may  form  a  corporation] ;  (7)  method 
of  keeping  accounts  and  ascertaining  and  dividing  the  profits;  (8) 
method  of  appointing  and  the  qualifications  of  directors  and  officers  ; 
(9)  how  stockholders'  meetings  shall  be  called  ;  (10)  conditions  of 
voting  and  method  thereof  ;  (n)  subjects  upon  which  a  simple  major- 
ity vote  shall  not  decide;  (12)  method  of  making  official  announce- 
ments and  the  journals  in  which  they  shall  appear.  Art.  209.  After 
the  subscription  of  the  capital  the  stockholders  shall  determine  by  resolu- 
tion in  general  meeting  that  the  capital  has  been  fully  subscribed  and 
at  least  ten  j-or  cent  (in  insurance  companies  at  least  twenty  per  cent) 
on  every  share  paid  in  ;  unless  these  facts  are  certified  in  the  original  ar- 
ticles. Art.  209a.  The  value  of  subscriptions  other  than  cash  must 
be  determined  in  the  articles.  Where  the  articles  have  not  been  execut- 
ed by  all  the  stockholders,  they  must  be  approved  at  a  general  meeting 
by  a  majority  vote  representing  at  least  one-fourth  in  number  and  in- 
terest, Art.  209b.  The  articles  must  be  recorded  at  length  in  the 
commercial  register  of  a  specified  local  tribunal  and  certain  portions 
must  be  published,  including  the  date  of  the  articles,  and  sub-divi- 
sions 1-5  and  12  of  Art  209  supra.  If  the  articles  provide  a  partic- 
ular form  in  which  the  official  corporate  acts  shall  be  executed,  that  must 
also  be  published.  Art.  210.  Application  to  the  tribunal  oT  commerce 
for  registration  must  be  accompanied  by  affidavits  that  all  requisite 
preliminaries  have  been  legally  performed.  Art.  210a.  The  associ- 
ation has  no  corporate  existence  before  the  registration,  so  that  all 
acts  are  void  and  the  doers  are  liable,  Art.  211.  The  same  formal 
registration  must  be  made  in  every  district  where  a  branch  is  estab- 
lished. Art.  212.  The  company  can  own  real  property.  Art.  213.  Alter- 
ations in  the  article  must  be  made  with  the  same  formalities  as  the  original 
contract.  Art.  214.  Unless  expressly  so  stipulated  in  the  articles  a  ma- 
jority vote  cannot  chai.^e  the  objects  of  the  corporation.  The  same 
applies  to  the  case  of  dissolution  and  reorganization.     The  corporation 


§  65 


GERMANY. 


168 


'ill 


'I  .li 


cannot  purchase  its  own  stock,  and  unless  provided  in  the  arMcles  or 
their  amendments,  cannot  amortise  its  stock  (i.  e.,  gradually  pay  back 
its  capital  stock  so  as  eventually  to  dissolve),  Art.  215.  A  fixed  per 
cent  of  return  on  shares  cannot  be  contracted  for  or  paid.  Dividends 
must  be  from  profits  oniy.  But  a  fixed  per  cent  may  be  contracted 
for,  for  the  period  defined  in  the  articles  as  preliminary  to  full  oper- 
ation. Art.  217.  In  no  case  is  a  stockholder  obliged  to  return  interest  or 
dividends  received  in  good  faith,  Art.  218.  There  is  no  personal 
liability,  Art.  219. 

The  following  rules  are  applicable  when  the  shares  are  "to  bearer": 
(i.)  The  shares  shall  not  be  issued  until  fully  paid.  (2.)  In  no  case 
can  a  subscriber,  by  transfer  or  otherwise,  escape  from  the  obligation 
to  pay  forty  per  cent — not  even  if  ajdjudged  to  have  lost  his  share  by 
failure  to  pay  calls.  (3.)  It  may  be  provided  in  the  articles  that  after 
forty  per  cent  is  paid,  the  subscriber  shall  be  discharged  from  furthur 
calls  and  may  receive  stock  promises  or  provisional  shares  covering  the 
amount  actually  paid.  Some  German  states  have  local  laws  substitut- 
ing twenty-five  per  cent  for  forty  per  cent  in  this  article.  Art.  222. 
When  the  shares  are  made  out  in  the  name  of  the  holder  they  must  be 
recorded  in  the  corporate  stock  book,  giving  name,  address  and  occu- 
i^iition  of  owner.  They  may  be  transferred  by  endorsement,  but  the 
transfer  must  be  announced  to  the  company  and  noted  on  its  book.  In 
all  corporate  relations  only  those  are  considered  stockholders  whose 
names  so  appear.  So  long  as  a  balance  is  unpaid,  a  transfer  can  only 
be  made  by  the  company  accepting  the  transferee,  and  the  transferer 
remains  liable  for  then  existing  obligations  for  one  year,  Arts. 
223,  182, 183.  Unless  otherwise  stipulated  in  the  articles,  every  share 
has  one  vote,  Art.  224. 

The  council  of  overseers  has  complete  power  to  examine  at  all  times 
into  the  corporate  affairs  and  must  report  to  the  general  meeting  of 
stockholders  annually.  It  may  call  such  meeting  when  corporate,  in- 
terests demand  it,  Art.  225a.  The  members  of  the  council  are  liable  for 
damages  when,  with  their  knowledge,  subscriptions  are  refunded,  the 
company's  own  stock  bought  or  amortised,  illegal  interest  or  dividends 
paid,  corporate  property  divided  or  capital  stock  diminished  without 
legal  formalities.  Art.  225b.  The  corporate  affairs  are  managed  and 
the  corporation  represented  by  a  board  of  directors  (or  it  may  be  by  one 
director).  They  may  be  paid  or  not,  and  may  be  stockholders  or  not. 
Their  appointment  is  always  revocable.  Art.  227.  The  members  of  the 
board  must  be  reported  to  the  tribunal  of  commerce  for  registration. 
Their  signatures  are  kept  on  record.  Art.  228.  If  not  otherwise  pro- 
vided, all  the  members  must  sign   for  the  company.  Art.  229.     The 


mMiumeesas^fMi^«^»^mamm 


^$^S3\me^i^r^ 


158 

rovided  in  the  articles  or 
(i.  e.,  gradually  pay  back 
e),  Art.  215.  A  fixed  per 
1  for  or  paid.  Dividends 
cent  may  be  contracted 
preliminary  to  full  oper- 
l)liged  to  return  interest  or 
,     There   is   no   personal 

le  shares  are  "to  bearer": 
ly  paid.  (2.)  In  no  case 
escape  from  the  obligation 

0  have  lost  his  share  by 
J  in  the  articles  that  after 
;  discharged  from  furthur 
isional  shares  covering  the 
have  local  laws  substitut- 
nt  in  this  article,  Art.  222. 
[  the  holder  they  must  be 
name,  address  and  occu- 

1  by  endorsement,  but  the 
md  noted  on  its  book.  In 
idered  stockholders  whose 
ipaid,  a  transfer  can  only 
isferee,  and  the  transferer 
ms  for  one  year.  Arts, 
in  the  articles,  every  share 

wer  to  examine  at  all  times 
to  the  general  meeting  of 
eeting  when  corporate,  in- 
if  the  council  are  liable  for 
riptions  are  refunded,  the 
legal  interest  or  dividends 
stock  diminished  without 
e  affairs  are  managed  and 
;ctors  (or  it  may  be  by  one 
ay  be  stockholders  or  not. 
227.  The  members  of  the 
lommerce  for  registration. 
128.  If  not  otherwise  pro- 
company.  Art.  229.    The 


159 


GERMANY. 


§  65 


contracts  of  the  board  bind  the  corporation  whether  such  appears  ex- 
pressly or  from  all  circumstances,  Art.  230. 

The  board'  is  obliged  to  act  within  the  authority  given  it  in  the  articles 
and  the  resolutions  of  the  general  meetings.  But  these  limitations  do 
not  affect  third  parties,  Art.  231.  Every  change  in  the  board  must  be 
reported  for  registration,  Art.  233.  The  company  may  also  appoint 
other  general  agents  to  manage  particular  matters  of  business  or  to 
represent  it  in  such  matters.  They  must  follow  instructions,  but  are 
general  agents.  Art.  234.  Unless  otherwise  stipulated  in  the  articles,  ten 
per  cent  of  the  capital  stock  may  call  a  meeting,  Art.  237.  No 
business,  except  the  call  of  an  extraordinary  meeting,  can  be  transacted 
unless  the  subject  thereof  was  duly  announced  in  the  notice  of  the 
meeting.  Art.  238.  The  board  is  responsible  for  the  keeping  of  proper 
books,  and  must  report  and  publish  an  .i.mual  statement  of  affairs, 
certain  features  of  which  are  prescribed,  Arts.  239,  239a.  The  mem- 
bers of  the  board  are  only  personally  liable  for  damages  arising  out 
of  their  own  acts  exceeding,  their  authority.  Art.  241. 

If  it  appears  from  the  annual  report  that  the  capital  stock  has  become 
diminished  by  one-half,  the  board  must  at  once  call  a  general  meeting. 
If  it  appears  that  the  corporate  property  no  longer  exceeds  its  debts  the 
court  must  be  notified.  Art.  240.  Imprisonment  and  fine  are  attached 
as  penalties  to  certain  illegal  acts  of  members  of  the  council  and  the 
board,  Art.  249.  / 


INDEX 


The  referencei  are  to  the  nectioni. 


Ml^iifillpVMWii^ 


Alabama,  i. 
Arizona,  44. 
Arkansas,  2. 


Banks,  National,  55. 
British  Columbia,  63. 


California,  3. 

Canada,  sH. 

Colorado,  4, 

Commerce,  inter-state,  a  state  cannot 
interfere  with,  50. 

Congrajjs,  see  United  States. 

Connecticut,  5. 

Constitutiondl  provisions,  see  the  vari- 
ous states,  also  United  States. 

Contracts,  the  obligation  of,  cannot  be 
impaired  by  a  state,  49. 


Dakota,  see  North  Dakota,  and  South 

Dakota. 
"  Dartmouth  Collf  ge  Case,"  49. 
Delaware,  6. 


England,   57. 


Federal  government,  see  United  States. 
Florida,  7. 
France,  64. 


Georgia,  8. 

Germany,  65. 

"  Granger  Cases,"  49. 


Idaho,  45. 

Illinois,  9. 

Indiana,  10. 

Inter-state  commerce,  a  state  cannot 

interfere  with,  50. 
•'  Inter-state  Railway  Act,"  56. 
Iowa,  II. 


Jurisdiction    of    the     United     States 
courts,    52. 


Kansas,  12. 
Kiiniucky,  13. 


Louisiana,  14. 


M 


Maine,  15. 
Maryland,  16. 
Massachusetts,  1 7. 
Michigan,  18. 
Minnesota,  19. 
Mississippi,  20. 
Missouri,  2i. 
Montana,  22. 

N 

National  Banks,  55. 
Nebraska,  23. . 
Nevada,  24. 
New  Brunswick,  61, 
New  Hampshire,  25. 
New  Jersey,  26. 
New  Mexico,  46. 
New  York,  27. 
North  Carolina,  28. 
North  Dakota,  29. 
Nova  Scotia,  60. 


162 


INDEX. 


The  references  are  to  the  lectioni. 


i* 


Ul 


Si 


Obligation  of  contracts  cannot  be  im- 
paired by  a  state,  49. 
Ohio,  30. 
Ontario,  62. 
Oregon,  31. 


I'':ins)I'  -.ah,  Vji. 


Quebec,  59. 


Railroads  chartered    by    the   United 

States,  54. 
Rhode  Island,  33. 


South  Carolina,  34. 
South  Dakota,  35. 
States,  1-42. 


Tennessee,  36. 
Territories,  43-48. 
Texas,  37. 

u 

United  States. 

constitL'tic'i'U  provisions,  J9  53. 

proteci:ing  co.  poratc  contracts,  49. 

r  gulating  commerce,  50. 

provisions  protecting  the  rights  of 
citizens,  51. 

jurisdiction  of  its  courts,  52. 

protecting  corporate  property,  53. 

may  charter  corporations,  54. 

national  banks,  55. 

the  Inter-State  Railway  Act,  56. 
Utah,  47. 


Vermont,  38. 
Virginia,  39. 


w 


Washington,  40. 
West  Virginia,  41. 
Wisconiin,  42. 
Wyoming,  48, 


11 


m    FM: 


AUG-8 1949 


<L. 


*«feS^ssf, 


isec,  36. 
tries,  43-48. 
37. 


States. 

nstitotic-i'U  provisions,  [9  53. 

oteci:ing  co.  porutc  contracts,  49. 

{ulating  commerce,  50. 

ovisions  protecting  the  rights  of 

citizens,  51. 

risdiction  of  its  courts,  52. 

otecting  corporate  property,  53. 

ly  charter  corporations,  54. 

tional  banks,  55. 

;  Inter-State  Railway  Act,  56. 

i7- 


nt,  38. 
a.  39 


w 


)  jton,  40. 
'^irginia,  41. 
11  in,  42. 
ing,  48. 


1 


